Equinix Inc (NASDAQ:EQIX) has announced plans to acquire Verizon Communications Inc. (NYSE:VZ) data centers.
The interconnected data services provider is buying 29 of the cell phone carrier’s data centers across 15 metro areas for $3.6 billion. The move will help expand Equinix’s portfolio in North America and Latin America.
The agreement is an all-cash deal that will increase the company’s portfolio to 175 data centers around the world. It will gain centers in Bogota, Colombia, Houston and other places around the world.
Verizon made the move due to the fact that the company’s data centers have been underperforming. Selling these off will let the company focus on its core assets.
The deal is slated to be completed sometime in the middle of 2017. Verizon decided to sell these assets because it wants to “trim the branches of the tree so the tree can be stronger,” according to CEO Lowell McAdam.
The company has also sold parts of its landline operation and cell tower assets recently, opting to spend its money on buying former Web giants such as AOL and Yahoo.
The new Equinix acquisitions are slated to serve about 900 customers. The company runs a business that hooks up its assets with other companies and data carriers.
The move is expected to raise debt and equity for Equinix over the coming years.
EQIX shares grew 1.9% Tuesday, while VZ stock rose 1.3%.
