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November 3, 2015

Equinix and Digital Realty enter separate transatlantic cable ventures

News: Are we moving from an M&A war to a subsea war?

By Joao Lima

Two of the world’s biggest data centre providers announced trans-Atlantic fiber connectivity deals within hours of each other.

Three months after Hibernia Networks landed a cable from Halifax in Cork, Ireland, the high speed global telecommunications services provider, has revealed it will supply Ethernet connectivity to and within colo Equinix’s Cloud Exchange.

Separately Digital Realty announced it has partnered with AquaComms, a provider of scalable, subsea capacity-based network solutions, to deploy a transatlantic fibre optic system, the America Europe Connect (AEConnect).

Spanning more than 5,400 kilometres between Long Island and also the west coast of Ireland, with stubbed branching units for future landings, the company expects AEConnect to be available in its data centre at 32 Avenue of the Americas by the end of 2015, with plans to expand availability to its two other New York facilities at 111 8th Avenue and 60 Hudson Street as well.

The company said the subsea cable features 130 gigabits per second by 100 gigabits per second, per fibre pair, which will provide low-latency connectivity from New York to London and to greater Europe.

Digital Realty Q3

Last week three weeks after completing the $1.886 billion acquisition of provider Telx, Digital Realty posted a bottom line of $183.09 million for Q3, up from $169.11 million when compared to the same quarter in 2014.

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Revenues were also up to $436 million, 4% more than Q2 and 6% more than in Q3 2014.

The data centre operator reported an adjusted EBITDA of $251 million for the third quarter, a 2% increase from the previous quarter and a 7% increase over Q3 2014.

Funds from operations (FFO) on a diluted basis was $178 million in the third quarter of this year, or $1.28 per share, compared to $1.26 per share in Q2 2015 and $1.22 per share in Q3 2014.

The firm said net income for the third quarter of 2015 was $58 million, and net income available to common stockholders was $39 million, or $0.28 per diluted share, compared to $0.86 per diluted share in Q2 2015 and $0.80 per diluted share in Q3 2014.

Digital Realty also had approximately $4.7 billion of total debt outstanding as of September 30, 2015, comprised of $4.4 billion of unsecured debt and approximately $0.3 billion of secured debt.

Following the formalisation of Telx acquisition, Digital Realty revised its 2015 core FFO per share outlook to $5.12 – $5.18 from the prior range of $5.05 – $5.15.

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