KKR and Singtel to acquire remaining stake in data center firm STT GDC for over $5 billion

In a significant move within the data center industry, private equity firm KKR and Singapore Telecommunications have announced their intention to acquire the remaining 82% stake in ST Telemedia Global Data Centres (STT GDC) for approximately S$6.6 billion (about $5.1 billion). This acquisition, as detailed by KKR in a recent statement, values STT GDC at an impressive enterprise level of S$13.8 billion. This strategic acquisition aligns with the burgeoning demand for data centers, particularly fueled by the rapid growth of artificial intelligence technologies. Upon completion of the deal, KKR will hold a substantial 75% stake in STT GDC, while Singtel will maintain a 25% share, factoring in the conversion of existing preference shares held by both parties. KKR's investment marks its largest infrastructure commitment in the Asia Pacific region to date, amidst a global surge in data center investments responding to the growing requirements for cloud computing and AI capabilities. Recent reports from S&P Global highlight a record high for data center deal-making last year, with investments surpassing $61 billion, up from $60.8 billion the previous year. David Luboff, co-head of KKR Asia Pacific and the head of Asia Pacific infrastructure, emphasized the ongoing appeal of digital infrastructure as a long-term investment theme, pointing to STT GDC's diverse operations and expansion potential. Established in 2014 and based in Singapore, STT GDC operates data centers across 12 markets, including regions in Asia Pacific, the UK, and Europe, boasting a design capacity of 2.3 gigawatts. The company serves a wide range of clients, providing colocation, connectivity, and support services to hyperscalers and enterprise customers. Arthur Lang, Singtel's group chief financial officer, also remarked on the strategic benefits of STT GDC’s geographical diversity, stating that it enhances Singtel’s position in the global data center market.