EdgeConneX to acquire Israel's Global Data Center for estimated $300-400 million
The Israeli company's highly secure, subterranean data centers in Herzliya and Petah Tikva are built in accordance with the Tier 3 Uptime global standard
EdgeConneX, which specializes in data center solutions, announced on Monday that it has agreed to acquire Global Data Center (GDC), an Israel-based data center operator headquartered in Herzliya. The companies did not reveal the value of the deal, but Calcalist has learned that it is estimated to be in the region of $300-400 million. Once completed, the acquisition will bring two new facilities into the EdgeConneX global data center platform, GDC’s underground facilities in Herzliya and Petah Tikva.
Moshe Lasman, Founder and CEO of Global Data Center, said the identity of the company acquiring GDC is of particular significance. "The important thing about this acquisition is that it shows that the data center market in Israel has really evolved over the past year. This is the result of a process that began 3-4 years ago and has made Israel a target for international investors in this sector. What was important to us was that we would be acquired by a strategic investor and not just a financial one. This is a company that runs dozens of similar centers across the world. That gives us a significant added value."
Moshe Lasman, Founder and CEO of GDC. Photo: Eyal Tueg
Lasman will continue to run GDC under EdgeConnex. "We will become a local branch of this international company and I will continue to manage it. I received quite a few offers to sell the company from local and international players, but we made the decision to focus on those that would provide additional value to clients. We could have sold the company for more had we done a deal with a financial organization, but we chose not to."
Lasman added that additional data centers will be set up in Israel following the acquisition. "They plan to expand significantly," he said.
"We have two centers of 7,000 square meters each in Petah Tikva and Herlizya. We serve big enterprise clients and don't deal with smaller end clients. We host insurance companies, banks, and major technology companies. Our center in Herzliya is already full and we are expanding it. The center in Petah Tikva has already been rented out in its entirety even before it has opened and we also have plans to expand there. EdgeConnex's arrival in Israel isn't just important from a financial standpoint, but it will also provide us with an international boost."
Global Data Center was founded in 2013 by Lasman in cooperation and with the financial backing of the Viola Group, a leading private equity investment firm. The company's highly secure, subterranean data centers are built in accordance with the Tier 3 Uptime global standard that serves as the current standard for advanced data centers.
Backed by EQT Infrastructure, one of the world’s largest infrastructure funds, EdgeConneX brings significant financial and professional resources and digital infrastructure industry experience to GDC. This backing and support will accelerate GDC’s development and ability to invest in new capacity in Israel.
“I am pleased to announce the expansion of the EdgeConneX global footprint to the Middle Eastern region with the acquisition of GDC,” said Randy Brouckman, CEO of EdgeConneX. "As always, the Company’s focus is on its customers and providing them with the capacity they want, where they want it, and when they want it. In the case of Israel, GDC’s talented leadership team, strong operational track record, and existing infrastructure help us accelerate meeting these requirements by providing a ready-made solution with a premium platform that is already well established in the market.”
According to estimations, Viola Group holds around 67% of GDC and is expected to make a return of $200-250 million on its investment.
“Israel attracts multinational players, which turn the country into a global hub in cloud computing, and the deal we’re announcing today shows the trust in the potential of the local market,” said Harel Beit-On, co-founder and general partner at Viola. “As early investors with a significant share in Global Data Center, we have been accompanying the development in the data center landscape for the past seven years and believe that the entrance of EdgeConneX to the Israeli market will further drive its growth. We congratulate Moshe Lasman and the management of Global Data Center for the deal.”