KKR and Singtel Close $5.1B Data Center Deal
KKR and Singtel have closed their $5.1 billion joint acquisition of ST Telemedia Global Data Centres’ Singapore operations. The transaction is one of the largest digital infrastructure deals in the region, highlighting continued private equity interest in data centers as a critical asset class. The deal's complexity required cross-border legal and financial expertise from firms including Clifford Chance and Allen & Gledhill.
- The transaction implies an enterprise value of approximately S$13.8 billion (about US$10.9 billion) for ST Telemedia Global Data Centres (STT GDC), including leverage and capital expenditure for committed projects. - This deal builds on a prior investment in 2024, where the KKR-led consortium, including Singtel, invested S$1.75 billion (approximately US$1.3 billion) into STT GDC through redeemable preference shares with detachable warrants. - Upon completion, KKR will hold a 75% stake, and Singtel will hold the remaining 25%. This move significantly scales Singtel's digital infrastructure business, a key pillar of its "Singtel28" growth strategy. - The acquisition is a major play on the growth of AI and cloud computing, which is fueling the demand for new data centers capable of handling resource-intensive workloads. STT GDC's portfolio has a total design capacity of 2.3GW across major markets in Asia-Pacific and Europe. - For KKR, this is part of a broader strategy of investing heavily in digital infrastructure. Its global portfolio includes other major data center platforms like CyrusOne and Global Technical Realty, with approximately $34 billion of equity committed to digital infrastructure across 24 investments. - The Southeast Asia data center market is a key growth area, with one forecast projecting the market to grow from US$13.71 billion in 2024 to US$30.47 billion by 2030, a CAGR of 14.24%. - This deal is one of the largest digital infrastructure transactions in Southeast Asia, following other significant regional deals like Blackstone's acquisition of AirTrunk, highlighting intense private equity interest in the sector. - The complexity of the cross-border transaction required a wide array of legal advisors, including Simpson Thacher & Bartlett for the KKR-Singtel consortium, Latham & Watkins for ST Telemedia, and Allen & Gledhill for Singtel, in addition to those mentioned in the summary.
