Private equity firm KKR and Singapore Telecommunications (Singtel) have announced the acquisition of the remaining 82% stake in ST Telemedia Global Data Centres (STT GDC) for 6.6 billion Singapore dollars (approximately $5.1 billion). This pivotal transaction, disclosed in a statement on Wednesday, values STT GDC at an enterprise worth of 13.8 billion Singapore dollars.
The acquisition aligns with a notable increase in demand for data centers, primarily fueled by the rapid growth of artificial intelligence technologies. Upon the deal’s completion, KKR is set to hold a 75% stake in STT GDC, while Singtel will retain a 25% ownership. This adjustment will account for the conversion of existing preference shares held by both investment partners.
KKR emphasized that this deal marks its most substantial infrastructure investment in the Asia Pacific region to date. The rise in global investment in data centers is driven by the urgent need for enhanced cloud computing infrastructure, as well as the increasing workloads associated with artificial intelligence.
Last year saw a record-breaking surge in global data center transactions, as companies raced to build the necessary infrastructure to support energy-intensive AI operations. According to S&P Global, investments in the data center market exceeded $61 billion, a slight increase from the previous year’s tally of $60.8 billion.
David Luboff, co-head of KKR Asia Pacific and head of Asia Pacific infrastructure, remarked on the enduring attractiveness of digital infrastructure as a long-term investment theme. He pointed to STT GDC’s diversified operations and future development projects as key factors supporting this investment.
Established in 2014 and based in Singapore, STT GDC operates data centers across 12 markets, spanning the Asia Pacific region, the United Kingdom, and Europe, featuring an impressive design capacity of 2.3 gigawatts. The company offers services including colocation, connectivity, and support for hyperscale and enterprise clients.
Arthur Lang, group chief financial officer at Singtel, highlighted that STT GDC’s extensive geographical presence enhances their market reach, positioning the Singtel Group as a formidable player in the global data center arena.
