Equinix, a data center business, announced on Tuesday that it is launching a joint venture with GIC, a sovereign wealth fund in Singapore, and the Canada Pension Plan Investment Board.
The joint venture aims to raise approximately $15 billion in cash.
With vast networking capacity and power consumption generally equivalent to a large city, Equinix and its partners will utilize the funds to extend the footprint of “hyperscale” data centers—the largest in the industry—in the United States.
WHY IT’S ESSENTIAL
The news coincides with a rush by businesses from all sectors to integrate AI into their operations, which is driving up demand for data centers’ enormous processing and storage capacity.
Equinix plans to expand its use of large data centers, which are commonly utilized by hyperscalers, which are the largest technological corporations globally, including Amazon, Microsoft, and Alphabet Google.
Laptops 1000By purchasing land for additional buildings and gradually installing more than 1.5 gigawatts of new capacity, the joint venture will almost triple Equinix’s investment in its hyperscale center initiative.
THROUGH THE NUMBERS
According to Equinix, it will own 25% of the JV’s shares, with GIC and Canada Pension Plan Investment Board, or CPP Investments, controlling 37.5% each.
To increase the total investable capital to more than $15 billion in the future, the JV will also take on debt.
THE CONTEXT:
Equinix raised its annual core earnings projection in August, riding a wave of robust growth in previous quarters driven by demand for its data centers.
It has also been considering growth in Southeast Asia, where there is a lot of room for expansion.
Earlier this year, it acquired three data centers in the Philippines.
For hyperscale initiatives spanning geographies, the organization already has a cooperation with GIC in Singapore.
