8-KMaterial AgreementsRegulation FDExhibits & Filings

EQUINIX INC 8-K Report, Material Agreement (Dec 6, 2016)

Filed December 6, 2016For Securities:EQIX

Summary

Equinix, Inc. (EQIX) has announced a significant strategic acquisition of Verizon Communications Inc.'s colocation data center business. This transaction involves the purchase of 24 data center sites (29 buildings) across the United States, Brazil, and Colombia for a cash consideration of $3.6 billion, subject to adjustments. The deal is expected to be funded through a combination of existing cash reserves and new debt and equity financings, with a $2.0 billion senior unsecured bridge facility committed by JPMorgan Chase Bank, Bank of America, and Merrill Lynch. This acquisition is a major expansion for Equinix, significantly increasing its global footprint and service offerings. The integration of Verizon's data centers is poised to enhance Equinix's market position and provide greater capacity for its existing and future customers. Investors should note that the transaction is subject to customary closing conditions, including regulatory approvals, and is anticipated to close by mid-2017. Equinix will also enter into colocation and lease agreements with Verizon post-acquisition.

Key Highlights

  • 1Equinix to acquire Verizon's colocation data center business for $3.6 billion.
  • 2Acquisition includes 24 data center sites (29 buildings) in the US, Brazil, and Colombia.
  • 3Transaction expected to be funded by cash on hand, debt, and equity financings.
  • 4Equinix has secured a $2.0 billion senior unsecured bridge facility for the transaction.
  • 5The deal is subject to customary closing conditions and is anticipated to close by mid-2017.
  • 6Verizon will become a colocation customer of Equinix post-acquisition through lease agreements.

Frequently Asked Questions

This 8-K filing announces a material definitive agreement, specifically Equinix's entry into a transaction to acquire Verizon's colocation data center business.

The acquisition has a cash purchase price of $3.6 billion, subject to adjustments. Equinix expects to fund this through a combination of cash on hand and proceeds from debt and equity financings, including a $2.0 billion committed bridge facility.

The transaction is expected to close by mid-2017. Key conditions include the absence of any injunctions or orders that prevent the transaction, material accuracy of representations and warranties, compliance with covenants, and the absence of any antitrust-related governmental proceedings that would significantly restrict Equinix or the business.

Yes, as part of the transaction, Equinix and Verizon will enter into colocation and lease agreements. Equinix will provide colocation services to Verizon, and Verizon will lease or sublease portions of the acquired data centers while continuing to operate its other businesses at these locations.