Highlights:
- Airtel’s data centre arm Nxtra Data valued at $ 235 million
- 25% of Nxtra Data to be bought by American investing firm Carlyle
- Airtel’s Nxtra Data is building multiple large data centres across India
The US-based investing firm Carlyle is set to purchase 35% of stake in the Indian Telecommunications firm Bharti Airtel’s data centre arm named Nxtra Data for a whopping $ 235 million (around Rs. 1,775 crore), the US equity group announced on Wednesday.
Carlyle, with this venture, will tap into the rapid growing digital service market in India.
The acquisition which will be done by an affiliate of Carlyle will give Airtel’s Nxtra Data the enterprise valuation of around $ 1.2 billion which is over Rs. 9,000 crore at the exchange rate of 1 USD = Rs. 75.58, the companies said in a statement.
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The remaining 75% stake in the firm will be held by Airtel in Nxtra Data.
Nxtra Data which is currently building various data centres all across India will use the capital to scale up its infrastructure said the firms.
Indian is witnessing a skyrocketing demand for data centres as more businesses are moving towards cloud computing and the demand of consumers for the digital services including smartphone entertainment is growing rapidly, the companies added.
Cloud and Entertainment services in India will represent the next revenue frontier for the conventional telecommunications carriers such as Airtel as the rate of both voice and data in the country are amongst the cheapest all around the globe.
Reliance Jio, which is Airtel’s biggest rival in India and is controlled by the riched man in the country Mukesh Ambani has a tie-up with Microsoft under which it will build all its data centres which will be hosted on Azure Cloud from Microsoft.
Managing Director (MD) and Chief Executive Officer (CEO) of India and South Asia Bharti Airtel, Gopal Vittal said, “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.”
Vittal added, “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.”
Managing Director of Carlyle Asia Partners advisory team, Neeraj Bharadwaj said, “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.” He added, “We look forward to collaborating with Airtel to unlock the full potential of Nxtra.”
