EMEA M&A in the Data center industry

The data center industry in EMEA has been experiencing significant growth in recent years, with companies increasingly turning to mergers and acquisitions (M&A) as a way to expand their operations and gain a competitive edge.

Why M&A in Data Center ?

M&A activities in the data center industry are driven by a range of factors, including the need to increase capacity, improve efficiency, and gain access to new markets and customers.

One of the key drivers of M&A activity in the EMEA data center industry is the increasing demand for cloud-based services. As more organizations move their applications and workloads to the cloud, the demand for data center capacity has skyrocketed. In response, data center operators are looking to expand their operations through M&A activities, enabling them to gain access to new markets and customers, and increase their capacity to meet the growing demand.

According to a report by Synergy Research Group, the total value of M&A deals in the data center industry reached a record high of $30 billion in 2020. The report notes that this was driven by a combination of large-scale deals and a high volume of smaller transactions.

The report also indicates that the leading acquirers in the data center industry are the largest global colocation providers, including Equinix, Digital Realty, and NTT Communications. These companies have been expanding their operations through a combination of organic growth and acquisitions, enabling them to gain a dominant position in the market.

Another factor driving M&A activity in the EMEA data center industry is the need to improve efficiency and reduce costs. By acquiring other data center operators, companies can gain access to new technologies and best practices, enabling them to streamline their operations and reduce costs. This can be particularly beneficial in an industry where energy costs are a major concern, and where even small improvements in efficiency can lead to significant cost savings.

M&A activities in the EMEA data center industry also provide opportunities for companies to diversify their offerings and expand their service portfolios. By acquiring companies with different areas of expertise, data center operators can expand their service offerings to include new services such as managed services, colocation, and cloud services. This not only helps to meet the needs of a broader range of customers, but also provides new revenue streams for the company.

Lastest M&E deals

There have been several notable M&A deals in the data center industry. Here are some of the most recent ones:

In March 2020, Digital Realty completed its acquisition of Interxion, a leading provider of colocation and interconnection services in Europe. The acquisition expands Digital Realty's footprint in Europe and provides access to new markets and customers.

In January 2018, Iron Mountain announced that it had acquired EvoSwitch, a leading provider of colocation and cloud services in Europe. The acquisition enables Iron Mountain to expand its operations in Europe and gain access to a new customer base.

These M&A deals reflect the ongoing consolidation and expansion of the data center industry, as companies look to gain a competitive edge and meet the growing demand for digital services. As the industry continues to evolve, we can expect to see more M&A activity in the coming years.

Prepare the next Data Center trends

The data center industry is constantly evolving, and there are several trends that are shaping the future of the industry.

The biggest one is Edge computing. Edge is a distributed computing model that brings computation and data storage closer to the location where it is needed, reducing latency and improving performance. As more devices become connected and generate vast amounts of data, edge computing is becoming an essential component of the IT infrastructure.

With the increasing demand for digital services, data centers are consuming more energy than ever before. To address this, data center operators are exploring new ways to make their facilities more energy-efficient and sustainable. This includes the use of renewable energy sources, such as solar and wind power, as well as innovative cooling technologies and more efficient hardware.

A hybrid cloud environment combines the benefits of public cloud services and private cloud infrastructure, enabling companies to leverage the scalability and flexibility of the cloud while maintaining control over their data. Hybrid cloud is becoming increasingly popular among enterprises as it provides a more flexible and cost-effective IT infrastructure.

As data centers become more complex and the amount of data generated continues to increase, automation and AI are becoming essential tools for managing and optimizing the IT infrastructure. Data center operators are investing in AI and machine learning technologies to automate routine tasks and improve operational efficiency.

Conclusion

Overall, M&A activities in the EMEA data center industry are expected to continue to grow in the coming years, driven by the increasing demand for cloud-based services, the need to improve efficiency and reduce costs, and the opportunity to diversify service offerings and expand into new markets.

As data centers continue to play a crucial role in supporting the growth of digital technologies, M&A activities will remain a key strategy for companies looking to stay competitive and expand their operations.