Equinix Continues to Expand Its Global Service Offering; Extending
to New, Customer-driven Markets in North America
FOSTER CITY, Calif. & TAMPA, Fla.--(BUSINESS WIRE)--Oct. 21, 2009--
Equinix, Inc. (Nasdaq:EQIX), a provider of global data center services,
and Switch & Data Facilities Company, Inc. (Nasdaq:SDXC), a leading
provider of data center and Internet exchange services, have entered a
definitive agreement for Equinix to acquire Switch and Data in a
transaction valued at approximately $689 million in cash and stock,
based on yesterday’s market close. The combination of the two companies
will further strengthen Equinix’s leadership position in the global data
center services market by extending the company’s presence to 16 new
markets across North America. Equinix will integrate Switch and Data’s
data center business and operations, including the company’s 34 data
centers in 22 markets in the U.S. and Canada. The acquisition will add
more than one million gross square feet of data center capacity,
bringing Equinix’s total global footprint to 79 data centers in 34
markets and more than six million square feet across the North American,
European and Asia-Pacific markets. It will allow Equinix to immediately
expand into new strategic markets, including Atlanta, Denver, Miami,
Seattle and Toronto, as well as provide a platform for future expansion
of Switch and Data assets.
The acquisition will help the companies’ customers respond to two broad
market trends. The rapid growth of demand for online information is
requiring companies to store and distribute larger volumes of latency
sensitive assets and applications at the network edge, near local
population centers. At the same time, the market compels companies to
develop global aggregation and distribution strategies for their digital
assets and applications. The transaction is expected to give Equinix
customers broader access to local markets for their network edge
deployments, and Switch and Data customers a comprehensive solution to
their global data center needs. The customers of both companies will
benefit from a stronger product portfolio and capacity pipeline in a
market where demand continues to outpace supply, and from doing business
with a partner that brings together the capabilities of two companies
with strong reputations for operational excellence and high customer
satisfaction.
“The strategic acquisition of Switch and Data by Equinix further
strengthens Equinix’s position as the most comprehensive global data
center services provider across North America, Asia-Pacific and Europe,”
said Steve Smith, president and CEO of Equinix. “Our complementary
business models, coupled with Switch and Data’s broad North American
market coverage, provide a platform for strong growth as well as an
opportunity to accommodate our customers’ demands for additional
services.”
“For more than a decade, Switch and Data has provided colocation and
data center services to support the needs of the world’s leading online
brands,” said Keith Olsen, president and CEO of Switch and Data. “These
businesses rely on Switch and Data to provide secure locations for them
to connect and safeguard their mission-critical applications. The
combination of Switch and Data’s North American site footprint and
Equinix’s global reach will increase our addressable market, enhance our
customers’ value, and drive incremental value to our stockholders.”
The parties are targeting completion of the transaction in the first
quarter of 2010. The transaction will be subject to customary closing
conditions, including the approval of Switch and Data’s stockholders and
regulatory approvals. The transaction is expected to qualify as a
tax-free exchange to Switch and Data’s stockholders with respect to the
stock portion of the merger consideration. Equinix was advised by J.P.
Morgan Securities Inc. and Davis Polk & Wardwell LLP. Switch and Data’s
lead financial advisor for the transaction was Piper Jaffray & Co., and
Deutsche Bank Securities Inc. and RBC Capital Markets served as
co-advisors; Switch and Data’s legal advisor was Holland & Knight LLP.
Raymond James & Associates, Inc. provided a fairness opinion to Switch
and Data's Board of Directors with respect to this transaction.
Financial Terms of the Transaction
Under the terms of the agreement, Switch and Data stockholders will have
the opportunity to elect to receive either 0.19409 shares of Equinix
stock or $19.06 in cash for each share of Switch and Data stock. The
overall consideration to be paid by Equinix in the acquisition will be
80% Equinix stock, 20% cash. In the event that holders of more than 80%
of Switch and Data’s stock elect to receive Equinix stock or holders of
more than 20% of Switch and Data’s stock elect to receive cash, the
merger consideration will be pro-rated to achieve these proportions. In
addition, a portion of the cash consideration payable to Switch and Data
stockholders may be replaced by an equivalent amount of Equinix stock to
the extent necessary to enable the transaction to qualify as a tax-free
exchange. The cash portion of the merger consideration will be financed
through Equinix’s existing cash on hand. Switch and Data’s directors,
executive officers and certain of its significant stockholders have
agreed to vote shares representing 35% of Switch and Data’s outstanding
stock in favor of the transaction.
Equinix will hold an investor conference call today at 5:30 p.m. Eastern
Time (2:30 p.m. Pacific Time). Switch and Data President and CEO Keith
Olsen will join Equinix President and CEO Steve Smith on the call to
discuss the details of this announcement. To hear the conference call
live, please dial 1-773-756-4788 (domestic and international) and
reference the passcode (EQIX). A simultaneous live Webcast of the call
will be available over the Internet at www.equinix.com,
under the Investors heading.
A replay of the call will be available beginning on Wednesday, October
21, 2009, at 7:30 p.m. (ET) through November 21, 2009 by dialing
1-203-369-1619. In addition, the Webcast will be available on the
company's Web site at www.equinix.com.
About Equinix
Equinix, Inc. (Nasdaq:EQIX) provides global data center services that
ensure the vitality of the information-driven world. Global enterprises,
content and financial companies, and more than 350 network service
providers rely upon Equinix’s insight and expertise to protect and
connect their most valued information assets. Equinix operates 45
International Business Exchange™ (IBX®) data centers across 18 markets
in North America, Europe and Asia-Pacific.
Important information about Equinix is routinely posted on the investor
relations page of its website located at www.equinix.com/investors.
We encourage you to check Equinix’s website regularly for the most
up-to-date information.
About Switch and Data
Switch and Data is a premier provider of data centers that house, power
and interconnect the Internet. Leading content companies, enterprises
and communications service providers rely on Switch and Data to connect
to customers and exchange Internet traffic. Switch and Data has built a
reputation for world-class service, delivered across the broadest
colocation footprint and richest network of interconnections in North
America. Switch and Data operates 34 sites in the U.S. and Canada,
provides one of the highest customer satisfaction scores for technical
and engineering support in the industry, and is home to PAIX®
— the world's first commercial Internet exchange, www.switchanddata.com.
This press release contains forward-looking statements that involve
risks and uncertainties. Actual results may differ materially from
expectations discussed in such forward-looking statements. Factors that
might cause such differences include, but are not limited to, the
challenges of acquiring, operating and constructing IBX centers and
developing, deploying and delivering Equinix services; unanticipated
costs or difficulties relating to the integration of Switch and Data
into Equinix; a failure to receive significant revenue from customers in
recently built out data centers; failure to complete any financing
arrangements contemplated from time to time; competition from existing
and new competitors; the ability to generate sufficient cash flow or
otherwise obtain funds to repay new or outstanding indebtedness; the
loss or decline in business from our key customers; the results of any
litigation relating to past stock option grants and practices; and other
risks described from time to time in Equinix’s filings with the
Securities and Exchange Commission. In particular, see Equinix's recent
quarterly and annual reports filed with the Securities and Exchange
Commission, copies of which are available upon request from Equinix does
not assume any obligation to update the forward-looking information
contained in this press release.
Equinix and IBX are registered trademarks of Equinix, Inc. Internet
Business Exchange is a trademark of Equinix, Inc.
Important Information for Investors and Stockholders
This communication may be deemed to be solicitation material in respect
of the proposed transaction between Equinix and Switch and Data. In
connection with the proposed transaction involving Equinix and Switch
and Data, Equinix plans to file with the SEC a Registration Statement on
Form S-4 containing a Proxy Statement/Prospectus and each of Equinix and
Switch and Data plan to file with the SEC other documents regarding the
proposed transaction. The definitive Proxy Statement/Prospectus will be
mailed to stockholders of Switch and Data. SWITCH AND DATA
STOCKHOLDERS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND
OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY IN THEIR ENTIRETY WHEN THEY
BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT
THE PROPOSED TRANSACTION.
Switch and Data stockholders will be able to obtain free copies of the
Registration Statement and the Proxy Statement/Prospectus (when
available) and other documents filed with the SEC by Equinix and Switch
and Data through the website maintained by the SEC at www.sec.gov.
In addition, Switch and Data stockholders will be able to obtain free
copies of the Registration Statement and the Proxy Statement/Prospectus
(when available) and other documents filed with the SEC from Equinix by
directing a request to Equinix, Inc., 301 Velocity Way, Fifth Floor,
Foster City, CA 94404, Attention: Investor Relations (telephone:
888-222-1162) or going to Equinix’s corporate website at www.equinix.com,
or from Switch and Data by directing a request to Switch & Data
Facilities Company, Inc., 1715 Westshore Boulevard, Suite 650, Tampa, FL
33607, Attention: Investor Relations (telephone: 866-797-2633) or going
to Switch and Data’s corporate website at www.switchanddata.com.
Equinix, Switch and Data and their respective directors and executive
officers may be deemed to be participants in the solicitation of proxies
in respect of the proposed transaction. Information regarding Equinix’s
directors and executive officers is contained in its annual proxy
statement filed with the SEC on April 23, 2009. Information regarding
Switch and Data’s directors and executive officers is contained in
Switch and Data’s annual proxy statement filed with the SEC on April 6,
2009. Additional information regarding the interests of such potential
participants will be included in the Proxy Statement/Prospectus and the
other relevant documents filed with the SEC (when available).
Photos/Multimedia Gallery Available: http://www.businesswire.com/cgi-bin/mmg.cgi?eid=6079385&lang=en
Source: Equinix, Inc.
K/F Communications, Inc. (for Equinix)
David Fonkalsrud,
415-255-6506 (Media)
dave@kfcomm.com
or
Equinix,
Inc.
Joan Powell, 650-513-7098 (Media)
joanpowell@Equinix.com
Jason
Starr, 650-513-7401 (Investor Relations)
jstarr@Equinix.com
or
STC
Associates (for Switch and Data)
Jennifer Handshew, 212-725-1900
ext. 228 (Media)
jhandshew@stcassociates.com
or
Switch
and Data
Chris Reid, 813-207-7722 (Media)
creid@switchanddata.com
Seth
Potter, 646-277-1230 (Investor Relations)
ir@switchanddata.com
