Verizon Communications completed its $1.4 billion acquisition of cloud service provider Terremark Worldwide on Monday, a move the telecommunication powerhouse says will catalyze Verizon's everything-as-a-service cloud computing strategy as it attacks the managed IT infrastructure and cloud services market.
Verizon agreed to buy Terremark in January for a whopping $1.4 billion. The acquisition completed Monday via a short-form merger under Delaware law. Verizon said Terremark will operate as a wholly owned subsidiary of Verizon and will remain in Miami.
Verizon plans to leverage the Terremark acquisition to fuel its cloud computing strategy, through which the company seeks to provide everything-as-a-service to businesses and government customers globally. Verizon said integrated cloud solutions from Verizon and Terremark will hit the market later this year.
"There is a fundamental shift under way in how enterprises consume IT resources, and concluding this transaction is a turning point in Verizon's push to provide integrated, enterprise-class cloud solutions and accelerate growth in this important segment," Robert Toohey, president of Verizon Business, said in a statement. "In the coming months, we'll leverage our collective strengths to roll out a differentiated portfolio of secure, on-demand cloud computing solutions to be delivered through a unified enterprise IT platform."
Bringing Terremark into the Verizon fold gives Verizon the ability to attack the cloud with products, professional services and people while utilizing a cache of IT plays including virtualization, managed hosting, application management and cloud computing solutions. Terremark brings to the table a thriving government business that will boost Verizon's federal cloud profile, the company said.
With the transaction on the books, Verizon also expands its data center foot print. Verizon now can leverage Terremark's Network Access Point Centers in Miami, Culpepper, Va., and Santa Clara, Calif.; its facilities in Europe and the U.S.; and its data center assets in Latin America including the Dominican Republic, Colombia and Brazil. All told, Terremark brings 13 data centers to Verizon's table. Meanwhile, Terremark customers now have access to the 200 data centers Verizon operates across 23 countries in North America, Europe and in the Asia-Pacific region.
Verizon's Terremark acquisition is a signal of more cloud computing consolidation to come and illustrates an increased presence from service providers, carriers and telecoms. Shortly after Verizon revealed its Terremark plans, Time Warner Cable said it would purchase NaviSite, a cloud hosting provider, for $220 million.