Carlyle to Buy 25 Percent of Airtel’s Data Centre Arm for $235 Million
Carlyle will buy a 25 percent stake in Indian telecom firm Bharti Airtel’s data centre arm for $235 million (roughly Rs. 1,775 crores), the US private equity group said on Wednesday, as it taps into the rapid growth of digital services in India.
The acquisition, by an affiliate of Carlyle, will give Airtel’s Nxtra Data an enterprise valuation of about $1.2 billion (roughly Rs. 9,066 crores), the companies said in a statement. Airtel will hold the remaining 75 percent stake in Nxtra.
Nxtra, which is building multiple large data centres across India, will use the proceeds from the deal to scale up its infrastructure, the companies said.
India is seeing a surge in demand for data centres as more businesses choose cloud computing, and consumer demand for digital services such as smartphone entertainment continues to grow, they added.
Cloud and entertainment services represent the next revenue frontier for traditional telecom carriers like Airtel, as voice and data rates in India remain among the cheapest in the world.
Gopal Vittal, MD & CEO (India and South Asia), Bharti Airtel, commented: “At Airtel, we have built a robust data centre portfolio that is future ready and scalable. For us, the security and data privacy requirements of our customers are our top priorities, which we have established as a key differentiator for our data centre offerings. Rapid digitisation has opened up a massive growth opportunity for data centres in India and we plan to accelerate our investments to become a major player in this segment. We are delighted to have Carlyle as a strategic partner in this exciting journey, particularly given their experience in this industry, and look forward to working with them.”
Neeraj Bharadwaj, Managing Director of the Carlyle Asia Partners advisory team, commented: “India is set to become one of the largest markets in the world for digital services. Airtel, with its proven track record of solid execution and customer focus, is well positioned to leverage the potential growth of data centres in India. We look forward to collaborating with Airtel to unlock the full potential of Nxtra.”
News Credit: NDTV.com