SGAPY Singapore Telecommunications Limited (PK)

By P.R. Venkat

Private-equity firm KKR has agreed to buy a 20% stake in the regional data center business of Singapore Telecommunications for 1.1 billion Singapore dollars (US$800.0 million).

The telecom company said Monday that the investment to be made by a fund managed by KKR puts the enterprise value of Singtel's overall regional data center business at S$5.5 billion.

Singtel said that KKR could increase its stake to 25% by 2027 at a pre-agreed valuation.

Singtel will use proceeds from the sale to expand its regional data center business across Asean markets, including Singapore, Indonesia, and Thailand, while exploring markets like Malaysia and others.

"This will widen the business' strategic choices, giving a variety of options to monetise in the future," Singtel said.

The transaction is expected to be completed by the fourth quarter of this year, subject to regulatory approvals.

"With more than S$6 billion being unlocked since we embarked on our strategic reset two years ago, we continue to focus on unlocking value for our shareholders," Singtel Chief Financial Officer Arthur Lang said.

KKR is making this investment as part of its Asia infrastructure strategy.

Some of its past investments include Pinnacle Towers, a digital infrastructure platform in Asia with a strong focus on the Philippines; First Gen, a provider of clean and renewable power in the Philippines; and Aster Renewable Energy, a platform that develops, builds, and operates solar, wind, and energy storage projects in the Asian region.

Write to P.R. Venkat at venkat.pr@wsj.com

(END) Dow Jones Newswires

September 17, 2023 20:03 ET (00:03 GMT)

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