June 10, 2009 (FinancialWire) — Data center services provider Equinix, Inc. (NASDAQ: EQIX) said it has entered into an agreement to sell $325 million of its 4.75% convertible subordinated notes due 2016. Citi (NYSE: C), J.P. Morgan Securities (NYSE: JPM) and Goldman, Sachs (NYSE: GS) are acting as joint book-running managers.

The company has granted the underwriters an over-allotment option to purchase up to an additional $48.75 million of notes on the same terms and conditions.

The notes will be unsecured, subordinated obligations of Equinix and interest will be payable semi-annually at a rate of 4.75% per year. The notes will mature on June 15, 2016. The notes will be convertible subject to certain conditions at an initial conversion rate of 11.8599 shares of Equinix common stock per $1,000 principal amount of notes, representing an initial conversion price of around $84.32 per share of Equinix common stock.

In connection with the offering, Equinix entered into capped call transactions with certain underwriters in the offering or their respective affiliates. The capped call transactions are expected by Equinox to reduce potential dilution upon conversion of the notes.

Equinix said it expects to see net proceeds of around $273.1 million. The company plans to use some of the funds to pay the cost of the capped call transactions and to fund the development of expansion opportunities. The balance of the net proceeds will be used for general corporate purposes.

Foster City, California-based Equinix operates 42 data centers across 18 markets in North America, Europe and Asia-Pacific.

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