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(Adds deal value, source)
TOKYO/FRANKFURT, March 3 (Reuters) - Japan's NTTCommunications Corp said on Tuesday it has agreed to buy Germandata centre firm e-shelter, becoming Europe's third-biggestoperator in the sector from the latest in a series of overseasacquisitions to counter sluggish domestic growth.
NTT Communications, an unlisted division of Japanesetelecoms company Nippon Telegraph and Telephone Corp (NTT) did not disclose financial terms but a person familiarwith the deal said that it values e-shelter at slightly morethan $1 billion including debt.
The equity part of the transaction is roughly 100 billionyen ($832 million), the source said. That is broadly in linewith another source's previous estimate on the proposed deal'svalue.
In a joint statement, NTT Communications and e-shelter saidthe Japanese business will acquire 86.7 percent of the Germancompany founded in 2000. Operating data centres in four majorcities in Germany including Berlin, as well as in Zurich andVienna, e-shelter is Germany's biggest provider of data centreservices, they said.
NTT plans to use e-shelter as a hub for further growth."Most of that will be organic growth, as there are only fewindependent data centres available, which compete with telecomsincumbents such as Deutsche Telekom and Vodafone," the person familiar with the deal said.
The European deal stretches the NTT brand further across theglobe. In 2010 parent NTT bought South Africa's Dimension Datafor 382 billion yen, followed in 2013 by NTT Communicationssigning deals with a combined value of 85.5 billion yen to takeover two U.S. cloud computing businesses, Virtela TechnologyServices and RagingWire Data Centers.
Parent NTT's shares were down 0.7 percent at the close inTokyo, against a flat benchmark Nikkei 225 index.
Lazard advised NTT on the deal, while e-shelter was advisedby Morgan Stanley.($1 = 120.1400 yen) (Reporting by Chris Gallagher and Teppei Kasai in Tokyo andArno Schuetze in Frankfurt; Editing by Edwina Gibbs, KennethMaxwell and David Goodman)
