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Equinix connects to Telecity

Equinix has snuck past Interxion to agree a merger with Telecity
June 3, 2015

Data centre operator Telecity (TCY) must feel like the belle of the ball. Weeks after agreeing to merge with Dutch peer Interxion, its management have recommended an even sweeter offer from US rival Equinix.

IC TIP: Hold at 1091p

The cash-and-shares bid equates to about 1,145p a share, valuing Telecity at £2.35bn. It represents a near-28 per cent premium to Telecity's share price before news broke of the group's talks with Equinix.

The tie-up promises to strengthen the pair's network and cloud infrastructure, increase data capacity, broaden their product suites and enlarge their customer bases. The deal should also deepen Equinix's foothold in Europe, adding Telecity's 39 data centres to its existing 30 facilities in the region and extending its reach into Milan, Helsinki and other new territories.