I Squared Capital, an infrastructure private equity firm, via its ISQ Global Infrastructure Fund III and ISQ Growth Markets Infrastructure Fund, today announced that it has agreed to acquire KIO Networks, a data center operator in Mexico and Central America from Tresalia Capital, the Mexico City-based family office for María Asunción Aramburuzabala Larregui, a Mexican billionaire. According to press reports from Bloomberg, KIO Networks could be valued at ~$1bn through this transaction with I Squared.
KIO Networks – Overview
KIO Networks is the largest data center operator in Mexico, with a regional presence in Central America and the Caribbean. Specifically, KIO Networks operates 40 data centers in Mexico, Panama, Guatemala, the Dominican Republic, and Spain, with 20+ megawatts of operational power capacity. Additionally, the company notes that there is significant expansion potential at its data centers, particularly in Mexico City and Querétaro.
Overall, KIO Networks provides carrier-neutral colocation services for hyperscale, telecom, technology, financial, corporate, and government customers.
Core Data Center Campuses
KIO Networks operates 11 core campuses, which together comprise 29 data centers. Below is a geographic breakdown of these core data center facilities:
- Mexico: located in the cities of Mexico City, Querétaro, and Monterrey. KIO Networks’ Mexican footprint includes MEX|1 (4 data centers), MEX|2 (2 data centers), MEX|3 (1 data center), MEX|4 (3 data centers), MEX|5 (8 data centers), QRO|1 (5 data centers), MTY|1 (1 data center)
- Central America, Caribbean: PA|1 (Panama – 2 data centers), GT|1 (Guatemala – 1 data center), DO|1 (Dominican Republic – 1 data center)
- Europe: ES|1 (Spain – 1 data center)
KIO Networks operates 11 edge facilities in Mexico. These data centers are distributed throughout the country in the secondary locations of Puebla, San Luis Potosí, Mérida (1 & 2), Cuernavaca, Guadalajara, Veracruz, Xalapa, Villahermosa, Tuxtla Gutiérrez, and Hermosillo.
KIO Networks facilitates connectivity to a range of national (e.g., Mexico) and international carriers at its data centers, providing its customers with different connectivity options. Specifically, these carriers include:
- Mexico: Axtel/Alestra, Bestel, C3ntro, Marcatel, Maxcom, MCM (Megacable), redIT (American Tower), Telmex, Totalplay, and Transtelco (Neutrona)
- International: AT&T, Cogent, GTT, Lumen Technologies, PCCW Global, Telefónica, Telia, and Verizon
KIO Networks also offers managed services for cloud, cybersecurity, and business applications.
KIO Networks’ key competitors in Mexico are, or will soon be, Ascenty (Digital Realty and Brookfield Infrastructure), Equinix, ODATA (Patria Investments), and Scala Data Centers (DigitalBridge).
I Squared Capital – Overview
I Squared Capital manages investments in the infrastructure sub-sectors of utilities, digital, energy, transport, and social. Indeed, the firm’s approach is global with investments in North America, Europe, Latin America, and Asia. I Squared has committed $3bn+ (also includes co-investments) to digital infrastructure, across six investments globally. Specifically, the firm’s digital infrastructure portfolio holds assets including cellular sites, data centers, and fiber networks.
I Squared, via its ISQ infrastructure funds, intends to use KIO Networks to anchor the development of its digital infrastructure strategy in Mexico and the rest of Latin America.