Equinix forms $15bn joint venture to expand AI-ready data centres

October 01, 2024 02:52 PM

Equinix has signed a joint venture agreement with Singapore’s GIC and Canada’s Pension Plan Investment Board (CPP Investments) to raise more than $15 billion in capital.

The new joint venture is designed to “nearly triple” the investment capital of Equinix’s xScale data centre program.

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“As the world's leading companies build out their infrastructure to support key workloads such as artificial intelligence, they require the combination of large-scale data centre footprints optimised for AI training and interconnection nodes for the most efficient inferencing,” said Adaire Fox-Martin, CEO and president of Equinix.

“Our xScale and IBX offerings are uniquely positioned to address this business need, enabling companies to realise the powerful potential of AI."

Under the terms of the agreement, CPP Investments and GIC will each control a 37.5% equity interest in the joint venture, and Equinix will own a 25% equity interest.

Each party will make equity commitments, with the joint venture expected to take on debt to raise the total pool of investable capital to more than $15 billion over time. Equinix's existing hyperscale joint venture portfolio in Europe, Asia Pacific, and the Americas has a committed investment of more than $8 billion.

The capital raised will be used to purchase land in the US to build new xScale data centres capable of powering workloads of more than 100 megawatts (MWs) — with a view to adding more than 1.5 gigawatts of new capacity for hyperscale customers.

An xScale data centre can power high-intensity workloads, including generative AI deployments, providing customers the ability to leverage a single platform that can span 72 global metros.

“Through this joint venture, we look forward to providing the funding needed to develop state-of-the-art digital infrastructure across the US,” said Goh Chin Kiong, chief investment officer for real estate at GIC.

“This investment will help meet the increasing demand for data centres driven by rapid technological advancements and marks a significant step forward in our broader data centre strategy,” said Max Biagosch, senior managing director, global head of real assets and head of Europe for CPP Investments.

The closing of the proposed joint venture is subject to regulatory approvals, with the trio behind it expecting it to close by the end of the year.

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