Equinix to Expand into Africa with Acquisition of MainOne

Tuesday, December 07, 2021 / 06:17 PM / Release by MainOne / Header Image Credit: MainOne

Expansion Aims to EnableOrganizations to Accelerate Digital Transformation throughout Africa

Equinix, Inc. (Nasdaq: EQIX), the world's digitalinfrastructure company, today announced its expansion into Africa through itsintended acquisition of MainOne, a leading West African data center andconnectivity solutions provider, with presence in Nigeria, Ghana and Coted'Ivoire. The acquisition is expected to close Q1 of 2022, subject to thesatisfaction of customary closing conditions including the requisite regulatoryapprovals.

The transaction has an enterprise value of US $320Mand is expected to be AFFO accretive upon close, excluding integration costs,marking the first step in Equinix's long-term strategy to become a leadingAfrican carrier neutral digital infrastructure company. With more than 200million people, Nigeria is Africa's largest economy and, along with Ghana, hasbecome an established data center hub. This makes the acquisition a pivotalentry point for Equinix into the continent.

Equinix believes MainOne to be one of the mostexciting technology businesses to emerge from Africa. Founded by Funke Opeke in2010, the company has enabled connectivity for the business community ofNigeria and now has digital infrastructure assets including three operationaldata centers, with an additional facility under construction expected to openin Q1 2022. Upon closing, these facilities will add more than 64,000 grosssquare feet of space to Platform EquinixÂ®, with 570,000 square feet of land forfuture expansions. MainOne owns and operates a subsea network from Nigeria toPortugal, as well as 1,200 kilometers of reliable terrestrial fiber networkacross southern Nigeria. These are all improving connectivity to and fromEurope, West African countries and the major business communities in Nigeria.When completed, this acquisition will extend Platform Equinix into West Africa,giving organizations based inside and outside of Africa access to one of theworld's fastest-growing markets.

Charles Meyers, President and CEO,Equinix:

"The acquisition of MainOne will represent a criticalpoint of entry for Platform Equinix into the expansive and rapidly growingAfrican market. MainOne's leading interconnection position and experiencedmanagement team represent critical assets in our aspirations to be the leadingneutral provider of digital infrastructure in Africa. Growth of dataconsumption in Africa is amongst the fastest in the world, and our customersare looking for a trusted partner to pursue the opportunities presented bybroad mobile adoption and greater connectivity across the region. MainOne'sinfrastructure, customer relationships, partner ecosystem, and operatingcapability will extend the reach of Platform Equinix and bolster opportunitiesfor customers in Africa and throughout the world".

Under the terms of the transaction, the managementteam, including CEO Funke Opeke, will continue to serve in their respectiveroles. Opeke holds a master's in engineering from Columbia University and wasnamed one of the World's Top 50 Women in Tech by Forbes in 2018 for her effortsin sparking internet adoption. She was also recently named one of the Top 10Women to Watch in the Data Center Industry by Data Centre Magazine.

Key Facts

Under the terms of the agreement, Equinix intends to acquire MainOne and itsassets with an all-cash transaction at an enterprise value of US$320M, which isexpected to be AFFO accretive upon close, excluding integration costs. Thetransaction is expected to close Q1 of 2022, subject to the satisfaction ofcustomary closing conditions including the requisite regulatory approvals.
MainOne's assets include:

Three operational data centers, with an additional facility under constructionexpected to open in Q1 2022. These facilities will add more than 64,000 grosssquare feet space to Platform Equinix, in addition to 570,000 square feet ofland for future expansions.
An extensive submarine network extending 7,000 kilometers from Portugal toLagos, Accra and along the west African coast, with landing stations inNigeria, Ghana and C0te d'Ivoire.
A terrestrial network of more than 1,200 kilometers of reliable terrestrialfiber in Lagos, Edo and Ogun States. Connectivity to terrestrial sites extendsacross 65 PoPs (points of presence) in cities across Portugal, Nigeria, Ghana, and Cote d'Ivoire.
Access to key internet exchanges enabling low latency to key global networks,including Amazon, Microsoft, Apple, Google, and Facebook.
An estimated 800+ business-to-business customers, including major internationaltechnology enterprises, social media companies, global telecommunicationsoperators, financial service companies, and cloud service providers.
Nearly 500 employees and a management team with a deep understanding of localand international markets.

The facilities generate approximately US$60M annualized (Q2'21LQA) revenue witha purchase multiple of approximately 14x EBITDA.
Globally,Platform Equinix is comprised of 237 data centers across 65 metros and 27countries, providing data center and interconnection services for over 10,000of the world's leading businesses, including more than 50% of Fortune 500companies.

Additional Quotes

John Dinsdale, Chief Analyst &Research Director, Synergy Research Group:

"Africa has been the missing piece in the Equinixjigsaw, and this acquisition of MainOne will be a great first step onto thecontinent. The demand for data center services in Africa is strong, withNigeria at the epicenter of exponential economic growth in West Africa. Nigeriais Africa's largest country by both population and economy, and its growthdrivers include rapid mobile adoption, increased data consumption from itsyoung population, good subsea and terrestrial connectivity, and a strongenterprise market. This is advancing the region toward a more digitalizedeconomy and driving data center growth and expansion to provide much-neededdigital infrastructure".

Funke Opeke, Founder and CEO, MainOne:

"Equinix will accelerate our long-term vision to growdigital infrastructure investments across Africa. I thank our foundingshareholders led by Mr. Fola Adeola, MainStreet Technologies, AFC, PAIDF, FBN,Polaris, and AfDB for investing in the MainOne vision to bridge the DigitalDivide in Africa. With similar values and culture to what we have jointly built-in twelve years, Equinix is the preferred partner for our growth journey. TheMainOne team is excited about the partnership created through the acquisition,and we look forward to building our next chapter together".

Eugene Bergen, President, EMEA,Equinix:

"Expansion in Africa has long been a strategicpriority for us. With MainOne, we have found a company that not only has highlycomplementary data center and connectivity assets, but can further acceleratethe expansion of our business model and growth objectives. CEO Funke Opeke andher team have built a powerful and dynamic infrastructure that will enableinternational customers access to the continent and African organizationsaccess to the global Equinix platform. Customers can take full advantage ofEquinix's leading global interconnection services to connect with customers andpartners, participate in rich digital ecosystems and expand their businessacross Africa and around the world".