Equinix, Inc., the world’s digital infrastructure company™, has announced its planned expansion into Chile and Peru through its intended acquisition of four data centers from Empresa Nacional De Telecomunicaciones S.A. (“Entel”), a leading Chilean telecommunications provider, for an enterprise value of approximately US$705 million.
The acquisition is expected to close in Q2 of 2022, subject to the satisfaction of customary closing conditions, and is expected to be immediately accretive to Equinix’s adjusted funds from operations (AFFO) per share upon close, excluding integration costs. The transaction includes three data centers in Chile; the transaction may also include one data center in Peru pending finalization of a definitive agreement.
Chile is the fourth-largest economy in South America, with the highest GDP per capita in the region. Santiago is emerging as a technology hub in South America, serving both regional cloud and content demand as well as local enterprises. According to IDC, enterprise edge spending in Latin America is expected to reach $8.573 billion by 2024, and in Chile it is anticipated to grow by double digits in the same period. Furthermore, between 2020 and 2024, IDC anticipates that cloud spending in Chile will increase 34.6%.
When closed, the transaction will expand Equinix’s coverage in this strategic market, solidifying its leadership as the top regional provider of digital infrastructure services. With three data center sites in Santiago, Chile, the transaction also includes significant expansion capacity for future growth in Santiago, allowing Equinix to support both immediate and future growth in the region. Under the terms of the agreement, Equinix and Entel have agreed to form a strategic partnership to enable enterprises in Chile and Peru to leverage hybrid multicloud solutions to accelerate their digital transformation.
Charles Meyers, President and CEO, Equinix, said, “Latin America holds enormous potential, and our commitment to the region has exponentially grown since we entered back in 2011,” said Charles Meyers, President and CEO, Equinix. “Chilean, Peruvian and multinational companies are thirsting for the digital infrastructure required to thrive in today’s economy; with today’s expansion, we’re broadening digital access and accelerating digital transformation across Latin America, while supporting growth in a responsible and sustainable manner.”
Antonio Büchi, CEO, Entel, commented, “This strategic partnership with Equinix, a world leading digital infrastructure company, allows us to focus our resources on businesses that add value to our customers. Entel has transformed over the years, and this partnership, which is more than an infrastructure transaction, is intended to set an important milestone in our strategic plan to extend our offerings into delivering digital services and provide expertise with new solutions that will accelerate our client’s digital transformation.”
Jon Lin, Executive Vice President and General Manager, Data Center Services & President, Americas (Interim), Equinix, said, “This is an exciting time for Latin America. The growth Chile and Peru are experiencing is driving and expanding a new set of requirements around data center and cloud connectivity. With these new sites, businesses in this region as well as multinationals will be able to operate on an expanded global interconnection platform to process, store, interconnect and distribute larger volumes of latency-sensitive data and applications at the digital edge, closer to end users and local markets.”