Terms agreed for Equinix’s $3.6 bn offer for Telecity

American data center provider Equinix on Friday said it has reached agreement on the terms of a $3.6 billion offer for smaller British rival Telecity, a proposed transaction that is part of a strategy of expanding its presence in Europe.

Equinix said in a filing with the London Stock Exchange that it is offering the equivalent of 11.45 pounds ($17.48 at the current exchange rate) per Telecity share, a 35 percent premium to the British company’s closing price on Feb. 10, the day before Telecity’s planned tieup with European rival Interxion Holding was announced.

The 50/50 cashshare offer agreed by the boards of Equinix and Telecity still must be approved by Telecity’s shareholders and regulators.

“The addition of TelecityGroup’s businesses will considerably strengthen Equinix’s offering to customers in Europe and beyond, reinforcing us as a global leader in global interconnection and data centers, as well as bringing the benefits of greater cloud and network density to our customers,” Equinix CEO Stephen Smith said in a conference call with analysts.

Telecity said on Feb. 11 that it had reached an allshare merger agreement with Dutch group Interxion to create a data center operator valued at $4.5 billion, but Equinix entered the mix in early May with a competing offer.

“The merger and implementation agreement that TelecityGroup entered into with Interxion on March 9, 2015, has been terminated,” the filing said.

Equinix’s shares were down 0.3 percent in afternoon trading on the Nasdaq, where they have risen 17 percent since the start of the year.

Telecity’s shares fell 0.7 percent in Friday trading on the London Stock Exchange.