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Digital Realty will issue 0.7067 shares to Interxion Holding shareholders for every share they own. Based on Digital Realty's closing price, the total comes up to USD 93.48 per share, with debt included valuation of USD 8.4 billion.
FREMONT, CA: Digital Realty is set to boost its European presence with a USD 7.15 billion acquisition of data center operator Interxion. Both the companies have agreed to the deal in principle, and the transaction will be closed once it garners shareholders' approval and passes customary closing procedures. Digital Realty will issue 0.7067 shares to Interxion Holding shareholders for every share they own. Based on Digital Realty's closing price, the total comes up to USD 93.48 per share, with debt included valuation of USD 8.4 billion.
Both companies believe they can benefit from each other's European footprints. Interxion's business network consists of 53 carrier and cloud-neutral facilities in 11 European countries and 13 metro areas, including Frankfurt, Amsterdam, and Paris. Combined with Digital Realty's presence in London and Dublin, the two companies will come together and provide for services to approximately 70 percent of the Gross Domestic Product (GDP) in Europe. Once the deal is closed, Interxion will be known as "Interxion, a Digital Realty company". Digital Realty CEO A William Stein will serve as the CEO of the newly combined company. Interxion CEO David Ruberg will be the chief executive of the combined company's Europe, Middle East, and Africa (EMEA) business.
With organizations pushing their workloads to the cloud, and their data to the network edge, the need for more data centers and colocation facilities arises. The increased continued bandwidth consumption is also due to services and applications like IoT, video streaming, and low latency 5G. Software giants like Microsoft Azure, Google Cloud, and Amazon Web Services are pushing the capacity of data centers while telcos and enterprises are also using them to enable their business services and applications. Equinix and Digital Realty have been at the forefront of this data center and colocation boom. Last month, Equinix expanded its global footprint by closing a USD 1 billion joint venture to develop hyper-scale data centers in Europe. These two companies have accounted for 36% of the total deal value over the 2015 to 2019 period.
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