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Data centre M&A deals up 18% and set for another record year

about 5 years ago by Lucy Cinder

Data centre M&A deals up 18% and set for another record year

Data Centre

Data centre M&A deals were up 18% from the first half of 2018, closing 52 new deals in that time frame, continuing a strong trend of growth over the last four years.

These latest figures come from Synergy Research Group, which show that the number of deals that closed in the first half of the year exceeded the number of deals that closed in the whole of 2016. 2019 is set to be another record year for data centre M&A with eight more deal having closed since the beginning of July. In addition, 14 more deals have been agreed with formal closure pending.

Since 2015, Synergy has identified over 300 closed deals with a total value of $65 billion. Of this, 57% were acquisitions made by public companies while private equity companies account for 53%.

“Analysis of data centre M&A activity helps to affirm some clear trends in the industry, not least of which is that enterprises increasingly do not want to own or operate their own data centres,” said John Dinsdale, a chief analyst at Synergy Research Group. “As enterprises either shift workloads to cloud providers or use colocation facilities to house their IT infrastructure, more and more data centres are being put up for sale. This, in turn, is driving change in the colocation market, with industry giants on a never-ending quest to grow their global footprint and a constant ebb and flow of ownership among small local players. We expect to see a lot more data centre M&A over the next five years.”

As for deal value, only a small number of data centre M&A deals were multi-billion dollar acquisitions. Eleven such deals were closed during the 2017-2018 period, while 2019 has yet to see a multi-billion deal closure. Since 2015 the largest deals to be closed are the acquisition of DuPont Fabros by Digital Realty, the Equinix acquisition of Verizon’s data centers and the Equinix acquisition of Telecity.

In terms of companies, over the 2015-2019 period, Equinix and Digital Realty, are by far the largest investors. In total, they account for 36% of total deal value over the period. Other notable data centre operators who have been serial acquirers include CyrusOne, Iron Mountain, Digital Bridge/DataBank, NTT and Carter Validus.

source capacitymedia

Industry: Data Centre / Data Center

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