The Carlyle Group will invest $235 million (about Rs 1,780 crore) for about 25 per cent stake in Airtel’s data centre business, Nxtra Data, company said on Wednesday.
The post-money enterprise valuation of Nxtra is around $1.2 billion and Carlyle will hold a stake of approximately 25 per cent in the business upon completion of the transaction, with Airtel continuing to hold the remaining stake of around 75 per cent, Airtel said in a regulatory.
Headquartered in the Delhi, Nxtra Data offers data centre services to leading Indian and global enterprises, start-ups, small and medium businesses and governments. Nxtra has a portfolio of 10 large data centres and more than 120 edge data centres provides customers with co-location services, cloud infrastructure, managed hosting, data backup, disaster recovery, and remote infrastructure management.
This deal will peg the enterprise valuation of Nxtra at $1.2 billion which is over Rs 9,084 crore.
“Bharti Airtel and Comfort Investments II, an affiliated entity of CAP V Mauritius Limited, an investment fund managed and advised by affiliated entities of the Carlyle Group, today announced an agreement under which Comfort Investments II will invest $235 million in Nxtra Data Limited, a wholly owned subsidiary of Airtel engaged in the data centre business,” a Bharti Airtel statement said.
It said that India is witnessing a considerable surge in demand for secure data centres as businesses undertake digital transformation and consumer demand for digital services continues to increase.
“The expansion of hyperscalers across the region following the government’s directive on data localisation is propelling a lot of this demand, with other market drivers including the growth in user data and increase in cloud penetration.” it said.
Nxtra is building multiple large data centres to capture significant growth opportunities in the country. Last year, the company commissioned a data centre in Pune and is building more across Chennai, Mumbai and Kolkata.
Commenting on the deal, Gopal Vittal, MD & CEO (India and South Asia), Bharti Airtel, said, “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,” he added.
The transaction is subject to regulatory approvals, including nod from the Competition Commission of India.
“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,” said Neeraj Bharadwaj, Managing Director of the Carlyle Asia Partners advisory team.