Category Archives: Telx

Digital Realty completes acquisition of colocation rival Telx for $1.9 billion

datacentreGlobal data centre operator Digital Realty has completed the acquisition of colocation provider Telx in a deal valued at $1.886 billion. Telx will now operate as Digital Realty’s colocation and connectivity line of business.

Funding the acquisition doubles Digital Realty’s footprint in the colocation business and gives it a new interconnection platform, explained William Stein, Digital Realty’s Chief Executive Officer. Digital Realty raised gross proceeds of approximately $1.9 billion of debt and equity capital to fund the Telx acquisition, after settling its forward equity sale transactions with each of its forward counterparties to issue 10.5 million shares and receive $714 million.

Further funding was provided when subsidiary Digital Delta Holdings issued $500 million of 3.400 per cent Notes and $450 million of 4.750 per cent Notes. In August it raised $250 million by closing its underwritten public offering of 10 million shares of 6.350 per cent series I Cumulative Redeemable Preferred Stock.

Stein said the vendor is looking to blend its technical real estate expertise with a more expansive global reach as customers demand new products and services.

“The combination of Digital Realty’s and Telx’s portfolios of data centres and capacity gives customers the platform they need to grow and compete in a data-driven world.  Our focus will give them the ability to scale on a global basis,” said Stein. The company is now so big that nobody can compete with it, he argued. “This acquisition creates unrivalled choice and value, when and where our customers need it,” said Stein.

Digital Realty to double datacentre footprint with Telx acquisition

Digital Realty is acquiring Telx to bolster its US datacentre footprint

Digital Realty is acquiring Telx to bolster its US datacentre footprint

Digital Realty is to acquire cloud and colocation solutions specialist Telx for $1.9bn in a move the company said would double its datacentre footprint in the US.

Telx is a direct competitor of Equinix and offers a combination of interconnection, cloud and colocation services to enterprises and IT service providers and as of March this year the company managed 1.3 million square feet in 20 facilities across the US – 11 of which are already being leased from Digital Realty.

“This transformative transaction is consistent with our strategy of sourcing strategic and complementary assets to strengthen and diversify Digital Realty’s datacentre portfolio and expand our product mix and presence in the attractive colocation and interconnection space,” said William Stein, Digital Realty’s chief executive officer.

“Telx’s well-established colocation and interconnection businesses provide access to two rapidly-growing segments with long-standing customer relationships in top-tier metropolitan areas such as New York and Silicon Valley.”

“The fact that more than half of Telx’s 20 facilities are run out of Digital Realty properties further highlights the strategic fit as well as the potential incremental revenue opportunities we expect to be able to pursue as one company on a global basis.  This transaction advances our objective of ensuring that Digital Realty’s suite of products and services is able to best serve our customers’ current and future datacentre needs,” Stein added.

Chris Downie, chief executive officer of Telx said: “The combination of Telx’s colocation and interconnection capabilities with Digital Realty’s expansive wholesale platform provides greater flexibility and optionality for our customers and creates a global solutions provider covering wholesale customer applications and smaller performance-oriented deployments in select high-growth urban submarkets across the US.”

The transaction is due to close later this year.