Equinix is expanding its global data center footprint into Africa with the acquisition of MainOne, a leading West African data center and connectivity provider, the companies said today. Equinix will pay $320 million for MainOne, which operates data centers in Nigeria, Ghana and Côte d’Ivoire, as well as a subsea cable along the West Coast of Africa.
The deal signals a new phase of growth for the data center market in Africa, making Equinix the latest multi-tenant data center player to establish a presence. Digital infrastructure development in Africa has trailed growth in other continents, but looks to accelerate with the market entry of three of the world’s largest and best-funded operators.
In October, Vantage Data Centers announced plans to build a data center in Johannesburg, and several weeks later Digital Realty formed a joint venture to acquire Medallion Data Centres, a leading colocation provider in Nigeria.
The three announcements are a clear indication that the data center industry’s leading players see Africa as an important strategic market, and are willing to move quickly to secure a competitive position. The expansion into Africa won’t come as a surprise to those who paid close attention at Equinix’s Investor Day 2021, when the company citied Ghana, Nigeria, Kenya and South Africa among potential expansion sites.
“The acquisition of MainOne will represent a critical point of entry for Platform Equinix into the expansive and rapidly growing African market,” said Charles Meyers, President and CEO of Equinix. “MainOne’s leading interconnection position and experienced management team represent critical assets in our aspirations to be the leading neutral provider of digital infrastructure in Africa.”
Hyperscale Interest Moves the Market
Why are global data center operators so interested in Africa? A key factor is the growth of hyperscale Internet companies, who are the most strategic players in the growth of digital infrastructure. Oracle recently announced plans to deploy a new cloud region in Johannesburg, where Microsoft has operated a cloud region since 2019. Meanwhile, Google is building laying the groundwork for future data center campuses in Africa by building the Equiano subsea cable, which will originate in Portugal and run along the West Coast of Africa to South Africa. Facebook is a partner in another subsea cable project that will bring capacity to Africa.
“Growth of data consumption in Africa is amongst the fastest in the world, and our customers are looking for a trusted partner to pursue the opportunities presented by broad mobile adoption and greater connectivity across the region,” said Meyers. “MainOne’s infrastructure, customer relationships, partner ecosystem and operating capability will extend the reach of Platform Equinix and bolster opportunities for customers in Africa and throughout the world.”
The arrival of hyperscalers and multi-tenant providers follows years of gradual growth in which local data center companies like MainOne and South Africa’s Teraco Data Environments have been the pioneering developers. Investor Berkshire Partners bought a majority stake in Teraco in 2019, leaving MainOne as an attractive acquisition opportunity amid a deal-driven industry consolidation.
MainOne Brings Data Centers, Subsea Cables and Fiber
Founder and CEO Funke Opeke and the MainOne management team will continue in their roles. Opeke, who holds a master’s in engineering from Columbia University, was named one of the World’s Top 50 Women in Tech by Forbes in 2018 for her efforts in supporting internet adoption in Africa.
“Equinix will accelerate our long-term vision to grow digital infrastructure investments across Africa,” said Opeke. “With similar values and culture to what we have jointly built in 12 years, Equinix is the preferred partner for our growth journey. The MainOne team is excited about the partnership created through the acquisition, and we look forward to building our next chapter together.”
MainOne’s assets include three data centers, with an additional site ready to come online early next year. These facilities will add more than 64,000 gross square feet space to Equinix, in addition to 570,000 square feet of land for future expansions.
A significant strategic asset is MainOne’s extensive submarine network extending 7,000 kilometers from Portugal to Lagos, Accra and along the west African coast, with landing stations in Nigeria, Ghana and Côte d’Ivoire. MainOne also operates a terrestrial network with more than 1,200 kilometers of fiber in Lagos, Edo and Ogun States and connectivity across 65 PoPs (points of presence) in cities across Portugal, Nigeria, Ghana and Cote d’Ivoire.
Growth Ahead for African Market
MainOne has about 800 customers, including major international technology enterprises, social media companies, global telecommunications operators, financial service companies and cloud service providers. The acquisition is expected to close in the first quarter of 2022.
“With MainOne, we have found a company that not only has highly complementary data center and connectivity assets, but can further accelerate the expansion of our business model and growth objectives,” said Eugene Bergen, President, EMEA at Equinix. “CEO Funke Opeke and her team have built a powerful and dynamic infrastructure that will enable international customers access to the continent and African organizations access to the global Equinix platform. Customers can take full advantage of Equinix’s leading global interconnection services to connect with customers and partners, participate in rich digital ecosystems and expand their business across Africa and around the world.”
A key trend to watch will be whether Equinix, Digital Realty and Digital Bridge continue to focus on the established data center markets in Nigeria and South Africa, or begin to extend their footprint into ot6her developing markets. These companies all have the development expertise and financial strength to deploy capacity quickly, and are likely to work closely with hyperscale customers to shape the growth of digital infrastructure across Africa.
The African Data Centre Association says that about 30 Tier III data centers have come online on the continent since 2016, and estimates that Africa will needs 1,000 MW of capacity and 700 data center facilities to meet growing demand and bring the rest of the continent onto level terms with the capacity and density seen in South Africa. A key factor will be the development of energy infrastructure to support these facilities.