(RTTNews) - Singapore Telecommunications Limited (SGAPY) or Singtel, announced on Monday that it has reached a definitive agreement with investment firm KKR & Co. Inc. (KKR) where a firm managed by KKR will invest up to around $800 million for a 20 percent stake in Singtel's regional data center business.
KKR will have the option to increase its stake to 25 percent by 2027.
As per the company, the investment will peg enterprise value of Singtel's overall regional data Centre business at S$5.5 billion.
The proceeds from the transaction will be used to accelerate the expansion of the regional data center business across ASEAN markets, including Singapore, Indonesia and Thailand.
"Southeast Asia's data centre market is expected to grow by 17% over the next five years compared to 12% for the rest of the world, with US$9 billion to US$13 billion in investments projected to flow into the region," the companies said in a statement.
"In addition to 62MW of existing capacity in Singapore, Singtel is building a new 58MW DC Tuas in Singapore and has also partnered Telkom and Medco Power in Indonesia and GULF and AIS in Thailand to develop data centers in Batam and Bangkok respectively. The data center portfolio will deliver a total combined capacity of over 155MW once the three new projects are operational in 2025, with room to scale up to more than 200MW," the company said in a statement.
On Friday, shares of KKR closed at $64.40 up 1.07% on the New York Stock Exchange and currently shares of Singtel are trading at S$2.40 down 0.83% on the Singapore Stock Exchange.
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