The Stack Archive News Article

Data centre acquisitions worth $20 billion in 2017

Thu 4 Jan 2018

$20 billion (approx. £14.8 billion) worth of mergers and acquisitions were carried out in the data centre market last year.

In a demonstration of the continued growth of the data centre, as cloud computing and the Internet of Things explode, the total value of deals closed in 2017 surpassed those in 2015 and 2016 combined.

There were 48 data centre related deals carried out throughout the year, amounting to nearly one a week. The biggest spenders include major names Equinix and Digital Realty, with the single largest transaction being the latter’s $7.6 billion purchase of DuPont Fabros.

As well as that major acquisition, there four more deals worth over $1 billion, 12 in the $100 million to $1 billion range, and 31 deals worth under $100 million. Not included is Equinix’s acquisition of Australian firm Metronode for $791 million late in 2017. That total of 48 deals compares to 45 carried out across 2015 and 2016 combined.

Future: What’s happening in the data centre in 2018

John Dinsdale, a chief analyst and research director at Synergy Research Group commented: “Above all else, what is driving the data centre merger and acquisition activity is enterprises focusing more on improving IT capabilities and less on owning data centre assets.

“That shift is driving huge growth in outsourcing, whether it is via cloud services, or use of colocation facilities, or sale and leaseback of data centres.

“The dramatic growth of cloud providers is also driving changes in the data centre industry, as data centre operators strive to help them rapidly increase scale and global footprint. We expect to see much more data centre M&A over the next five years.”

Recent data centre acquisitions last year include the purchase of IO Data Centers by Iron Mountain for around $1.315 billion and Extreme Networks’ acquisition of Brocade’s data centre business.

As well as these acquisitions, 2017 saw a huge number of expansions and new builds, as the data centre market continues to grow in importance.


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