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NTT Communications buys majority of e-shelter to expand presence in Europe

NTT Communications (NTT Com) has acquired most of German data centre operator e-shelter, making it the third biggest data centre operator in Europe.03 Mar 2015

The Japan-based telecommunications and IT services company will now be in a stronger position to compete for multinational business, it said in a statement.

E-shelter currently manages nearly 90,000 square meters of data centre space in four major cities in Germany, as well as Zurich, Switzerland and Vienna, Austria, NTT Com said. One of its main facilities, Campus Frankfurt 1, is Europe’s largest data centre with 60,000 square meters of space in five buildings constructed specifically as data centres.

The acquisition will help NTT Com to meet increased demand for data centre and cloud services from customers, and to provide efficient services to migrate customer systems to the cloud, the company said.

NTT Com currently operates data centres in the UK, France, Germany and Spain, it said. Two-thirds of NTT Com's data centre space is now outside of Japan, Data Centre Knowledge said.

Data Centre Knowledge quoted Chris Davis, NTT Com's senior director of marketing for the Americas region: "We’re building data centres as quickly as we can, but we needed the acquisition to quicken the pace."

E-shelter chief executive Rupprecht Rittweger said: "As our multinational customers expand beyond EU borders, and undergo rapid evolutions, they are increasingly demanding globally seamless solutions. To meet their demands ahead of our competitors, we believe that the best way to ensure e-shelter’s growth and development is in partnership with NTT Com, which has a commanding presence in Asia and is a leading provider of ICT (information communications technology) services worldwide. At the same time, we look forward to strengthening NTT Com’s global ICT infrastructure and market share with our strong presence in Europe."

Last month, Apple announced that it would spend €1.7 billion in building and operating new data centres in Ireland and Denmark.

At the time, data protection law expert Marc Dautlich of Pinsent Masons, the law firm behind, said many technology companies are building data storage facilities in Europe.

"There are practical reasons why technology providers look to locate their data centres closer to the third party servers they are exchanging information with, including to reduce latency – the delay in the time it takes for data to be processed and travel across a network. However, another main factor in decisions to locate data centres in Europe is EU data protection laws," Dautlich said.

Many EU businesses and governments are looking for local storage of data, due to concerns about access by foreign authorities to the data stored in their jurisdiction, Dautlich said.

Following the acquisition of e-shelter shares by NTT Com, a "significant minority stake" in e-shelter will be retained by Investa Holding, a German real estate developer in which Rittweger owns a controlling interest. Currently, Investa owns 51% of e-shelter’s issued shares. The remaining shares are owned by ABRY Partners, a media, communications and business-information services organisation, and other minority shareholders. NTT Com will provide more than half of e-shelter’s new board of directors, it said.