KKR, Singtel consortium to pay $5.2 billion to take full control of STT GDC

By Roushni Nair and Yantoultra Ngui Feb 4 (Reuters) – A KKR and Singapore Telecommunications consortium will pay S$6.6 billion ($5.2 billion) in cash to buy the remaining 82% stake in ST Telemedia Global Data Centres (STT GDC), valuing the Singapore-based data centre operator at an implied enterprise value of S$13.8 billion, the companies said on Tuesday. Reuters reported in November that KKR and Singtel were in advanced talks to buy more than 80% of STT GDC in a deal that would give them full ownership. The acquisition, the largest M&A deal in Singapore in the past four years and Southeast Asia's largest data centre transaction ever, comes as demand for AI computing and cloud services is booming amid the intensifying race for data centre capacity, power access and scale across Asia. Under the deal, the KKR-led consortium will acquire the remaining 82% stake in STT GDC from its founding shareholder, ST Telemedia, via STT Communications Ltd, an indirect wholly owned subsidiary of Temasek Holdings, the companies said. On completion, KKR and Singtel will hold 75% and 25% respectively, taking into account the conversion of existing redeemable preference shares held by both investors, the companies said. The cash consideration will be paid in two equal tranches, with half due at closing and the remaining amount payable around a year later, according to Singtel's exchange announcement. The purchaser has secured debt facilities of about S$5 billion to fund the consideration as well as future capital expenditures and other corporate purposes, it said. Singtel said it has committed S$740 million to the acquisition vehicle via an equity injection, with the investment expected to be funded from internal cash resources. Singtel added the transaction is not expected to have a material impact on its credit rating or dividend policy. Founded in 2014 and headquartered in Singapore, STT GDC is a data centre platform with about 2.3 gigawatts of design capacity across 12 major markets in the Asia Pacific, the U.K. and Europe, providing co-location, connectivity and around-the-clock support services, the companies said. KKR and Singtel first invested S$1.75 billion in the data centre firm in June 2024. KKR currently owns about 14% of the firm, while Singtel, the city-state's biggest telecom operator, has a stake of more than 4%. "Digital infrastructure remains one of the most compelling long-term investment themes globally," David Luboff, co-head of KKR Asia Pacific and head of Asia Pacific infrastructure at KKR, said, adding the deal was a "rare opportunity" to back a scaled platform and deepen its partnership with Singtel. Temasek framed the transaction as a handover to new owners positioned to accelerate growth. "We welcome the next chapter for STT GDC with KKR and Singtel," Ravi Lambah, head of strategic initiatives at Temasek, said. The transaction is expected to close by early in the second half of 2026, subject to customary closing conditions including regulatory approvals. Citi acted as lead financial advisor to the KKR and Singtel consortium and provided acquisition financing on the deal. ($1 = 1.2699 Singapore dollars) (Reporting by Roushni Nair in Bengaluru and Yantoultra Ngui in Singapore; Editing by Pooja Desai, Subhranshu Sahu and Chris Reese)

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