Telkom Indonesia looking to sell stake in data centre business, to conclude deal by H2

Digitalbridge

06/02/2024 08:36

By Yantoultra Ngui
       SINGAPORE, Feb 6 (Reuters) - Indonesia's state-owned
communication giant Telkom Indonesia  TLKM.JK  is considering
selling a stake in its data centre business and is expected to
finish the selling process in the second half of this year.
    The group is in the process of selecting its financial
adviser and considering how much stake to sell, Telkom Senior
Vice President of Corporate Communication and Investor Relations
Ahmad Reza said.
    According to two sources with knowledge of the plan, a sale
of a minority stake is expected to kick off in March and value
Telkom's data centre business at more than $1 billion. 
    Reza did not comment on the size of the stake, or when the
sale would kick off or the valuation, but said monetization of
the data centre business was still being discussed and Telkom
does not have any specific target.    
    Roping in a global strategic partner or strong financial
investors is expected to help Telkom expand its data centre
business further, both locally and globally. 
    Telkom, Indonesia's largest telecommunication group, has 28
data centres, which includes 23 at home and five overseas,
according to its 2022 annual report.
    It competes with several companies that have also
established data centres such as DCI Indonesia, Princeton DG and
NTT Communication, according to the annual report. 
    "As the internet penetration worldwide is growing rapidly,
the data centre business is becoming a hot asset to invest in,
including in Indonesia," Reza said. 
    Global investors' demand for infrastructure assets such as
data centres across Southeast Asia have grown in recent years,
amid the region's growth prospects and the sector's stable and
long-term returns.
    In September, global investment firm KKR & Co  KKR.N 
acquired a 20% stake in Singapore Telecommunications'  STEL.SI 
regional data centre business for S$1.1 billion ($818 million).
 ($1 = 1.3450 Singapore dollars)

 (Reporting by Yantoultra Ngui in Singapore; Editing by Kane Wu
and Himani Sarkar)
 ((Yantoultra.Ngui@thomsonreuters.com;))