Equinix to Buy Some Verizon Data Centers for $3.6 Billion

By Austen Hufford 

Data center company Equinix Inc. said it would buy 24 data center sites from Verizon Communications Inc. for $3.6 billion in a move to expand its offerings.

Equinix said the deal includes 29 data center buildings across 15 metro areas. The company highlighted the locations in Miami, where a network access point connects the U.S. to Latin America, and another in Virginia, which connects with government customers.

In a letter to customers, Equinix Chief Executive Steve Smith said the growing needs of its customers for more partners in more places led to the deal.

The deal also includes about 250 Verizon employees.

Verizon has been selling physical assets in recent years, including multibillion assets sales to Frontier Communications Corp. and American Tower Corp.

Verizon CEO Lowell McAdam said at an investor conference Tuesday that Verizon didn't have very much scale in data centers so it was better to sell them and put that money to better use.

The carrier wants to "trim the branches of the tree so the tree can be stronger," Mr. McAdam said.

Shares of Equinix rose 2.75% in recent trading as Verizon shares rose 0.9%.

--Ryan Knutson contributed to this article.

Write to Austen Hufford at [e-mail]

(END) Dow Jones Newswires

December 06, 2016 10:45 ET (15:45 GMT)

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