Orange plans €3 billion joint sovereign data center venture

Orange has announced a deal with global infrastructure investor Morrison to create a jointly-controlled sovereign data center company in France.

The proposed venture would build on Orange's existing French data center portfolio, aiming to bring total capacity up to 400 MW – nearly ten times its current level.

Orange would contribute five major data centers across four campuses in France – Chevilly-Larue, Aubervilliers, Chartres and Val-de-Reuil – to the joint venture, along with its operational expertise and commercial reach.

Morrison, meanwhile, would commit equity, with the platform supported by an investment program of €3 billion leveraging Orange's existing assets, Morrison's equity contribution, and debt.

"Europe's digital future will require significant new investment in trusted infrastructure capable of supporting the growth of cloud services, artificial intelligence and data-intensive applications," said William Smales, chief investment officer at Morrison.

"We believe France is exceptionally well positioned to play a leading role in Europe's digital economy, and this partnership represents an important step towards building the sovereign infrastructure needed to support future growth and competitiveness."

The companies said the platform will benefit from some of the most decarbonized electricity in Europe, and will aim for the highest standards of energy efficiency and environmental sustainability.

Orange Business will serve as the exclusive partner for the distribution of its colocation and hosting offers for large enterprises, SMBs, and public-sector entities.

Strategic planning

Beyond hosting and storage capacity, the sovereign platform will serve as a strategic foundation for Orange Business's cloud and AI solutions.

The firm's platforms and services will continue to be hosted in the planned joint venture's data centers, with Orange keeping operational control over the areas dedicated to its own operations.

This, said Orange, will give customers a level of security and availability for hosted systems and related data that meets the most stringent national and European standards.

“We are absolutely convinced that France will need sovereign, trusted digital infrastructure if it is to rise to the challenge of surging demand driven by cloud and artificial intelligence," said Christel Heydemann, CEO of Orange group.

"This contemplated joint venture with Morrison will allow us to unlock the value of our existing assets and strengthen our position in data centers. Together with a partner recognised for its expertise and investment capacity, we will accelerate the deployment of the capacity that the market needs."

Long-term goals

The two companies expect to have the deal signed by the end of this year, after a consultation with bodies representing employees and receipt of the required regulatory approvals. It's expected to close in the first quarter of next year.

While digital sovereignty is becoming increasingly important in Europe, things are set to move slowly over the next five years.

According to Forrester’s Global Sovereignty Forecast, European firms are only expected to make modest gains on this front. Nations such as Germany, France, and the UK rank among the most aggressive in their plans for sovereignty improvements.

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