Equinix, Inc., the global interconnection and data center company, announced that it would form a $1 billion joint venture with GIC, Singapore's sovereign wealth fund, to develop and operate xScale data centers in Europe. The joint venture will be in the form of a limited liability partnership. GIC will own an 80% equity interest in the joint venture, and Equinix will hold the remaining 20% equity interest.
“It has been a long journey to reach this point, but we are tremendously excited to announce the formation of our first xScale data centers joint venture. Partnering with a world-class investment partner like GIC will provide the opportunity to make significant capital investments in order to capture targeted large-footprint deployments while continuing to optimize our capital structure,” said Charles Meyers, President, and CEO, Equinix.
The new xScale data centers will be located on or near Equinix’s IBX campuses. According to the company, the initial facilities in the joint venture will serve the unique core workload deployment needs of a targeted group of hyperscale companies, including the world's largest cloud service providers. xScale data centers will be managed and staffed by Equinix.
With xScale data centers, hyperscale companies will now be able to add core deployments at Equinix to their existing access point footprints. It enables their growth on a single platform that spans more than 50 global metros and offers direct interconnection to their customers and strategic business partners.
The joint venture is expected to close in Q3 2019. Equinix will sell both its London LD10 and Paris PA8 IBX data centers and the associated leases, as well as certain other development interests, to the joint venture. As per the agreement, additional new xScale data centers are expected to be developed in Amsterdam, Frankfurt, and London. These initial six facilities, once fully built out, will provide approximately 155 megawatts (MW) of power capacity.