Telco 5G Networks acquires Sydney colocation provider for $3.5 million

Broadband network operator 5G Networks has expanded its data centre business with the acquisition of Sydney-based Australian Pacific Data Centres (APDC).

APDC, not to be confused with the Asia Pacific Data Centres, the former property trust that owned three of NextDC’s data centres, operates a data centre in the suburb of Pyrmont.

5G Networks shelled out $3.5 million for the colocation provider, whose main facility has a capacity of more than 150 racks with 30 percent current utilisation. The company now owns and operates more than 600 racks across Sydney, Melbourne and Adelaide.

5G Networks will also extend its 5GN Cloud Port offering to the new data centre, a product packaging cloud access and connectivity into other data centres in Australia.

In an ASX announcement (pdf) released today, 5G Networks managing director Joe Demase said, “This is a valuable acquisition as typically facilities like APDC are not available; this purchase successfully executes on our infrastructure plans and we now have a clear understanding of what the next chapter looks like.”

Demase added the company will continue to explore strategic acquisitions as it looks to grow profits and fully optimise its infrastructure assets.

“This is also welcome news for our customers, where 5GN can now offer dedicated and secure access from our connected data centres all the way through to cloud and managed network services in Sydney, Melbourne and Adelaide.”

The APDC data centre is a purpose-built Tier 3 facility that has been in operation for 15 years. 5G Networks expects to generate around $500,000 in annualised savings starting in the second half of FY20.

5G Networks has been acquiring data centre providers as part of its wholesale channel strategy for data centre services, as it looks to introduce its fibre network and cloud services to other telcos, hardware vendors and MSPs. In April this year, the company acquired Melbourne Data Centre for $5.7 million.

In addition to the acquisition, 5G Networks also expects to expand its fibre broadband network to connect clients in Sydney CBD and inner metro areas to save costs from third party providers, replicating the existing infrastructure in Melbourne. The company said it is also looking to offer dark fibre to larger corporate customers and wholesalers when available.