KKR and Singtel in advanced talks to acquire STT GDC for US$10 billion
STT GDC has over 100 data centres and 2.3GW of capacity across a dozen countries.
A consortium led by KKR and Singtel is in advanced talks to buy STT GDC, which has a network of over 100 data centres worldwide. Here's what the deal is about.
Largest deal in Asia
This news was first reported in November, with KKR and Singtel said to be seeking to borrow S$5 billion for a proposed acquisition.
On Saturday, a new report by the Wall Street Journal noted that talks are in an "advanced" stage for a deal that would value STT GDC at more than S$13 billion (US$10 billion).
According to Bloomberg on Sunday, Singapore's GIC and Abu Dhabi's Mubadala are in discussions to join KKR and Singtel as minority co-investors.
If completed, this acquisition would rank among Asia's biggest data centre transactions.
More about STT GDC
ST Telemedia currently owns 82% of STT GDC, which it established in 2014 to push into the data centre space. An earlier S$1.75 billion investment in 2024 means KKR already owns around 14% and Singtel around 4%.
ST Telemedia is wholly owned by Temasek Holdings.
STT GDC has grown rapidly over the years, through a combination of acquisitions, joint ventures, and greenfield data centres. It moved early and adopted a diversified strategy to enter multiple markets, long before generative AI entered the spotlight.
Today, STT GDC has a combined capacity of more than 2.3GW spread over more than 100 data centres located in a dozen countries: six in Southeast Asia, India, South Korea, Japan, and three others in Europe.
What is the deal about
As I wrote in November, an acquisition would help build Singtel Nxera into a leading, global data centre player.
Singtel Nxera is currently developing new data centres in Johor, Batam, and Thailand. However, these take time to construct and build up. An acquisition would propel Nxera into a powerhouse overnight.
Moreover, Nxera's consolidation in Singapore with the closure of five old data centres leaves it with just three facilities. STT GDC's six in Singapore would greatly bolster its geographical coverage in the important data centre hub.
There is one more consideration. While the AI frenzy has fuelled interest in data centres, the reality is that many key regions require more digital infrastructure for non-AI deployments.
On this front, STT GDC's substantial footprint will serve as a crucial resource, whether in terms of familiarity with the region, training new data centre specialists, or doing R&D.
