In 2023, the region’s data centre deals hit a record high of US$3.45 billion, according to LSEG. That tally is set to be surpassed this year, with at least a couple of large transactions in the pipeline.
Data centres are secure, temperature-controlled facilities that house large-capacity servers and data-storage systems, with multiple power sources and high-bandwidth internet connections. More enterprises are now using data centres to host or manage computing infrastructure for their artificial intelligence projects. Photo: Shutterstock
A number of financial sponsors, including global investment powerhouse Blackstone, are looking to acquire AirTrunk, which owns 11 hyperscale data centres in Australia and across the rest of the region, sources close to the transaction said.
AirTrunk’s owners, Macquarie Group and Canada’s Public Sector Pension Investment Board (PSP), aim to value the business at up to A$15 billion (US$9.8 billion), sources said, in what could be Asia’s largest data centre transaction this year.
AirTrunk, Blackstone, Macquarie and PSP declined to comment.
“The AI revolution is creating an unprecedented wall of demand for high-quality data centre capacity,” said Garren Cronin, managing director of Cadence Advisory, which advised on Australian data centre operator NEXTDC’s US$861 million fundraising in April.
Microsoft chairman and chief executive Satya Nadella speaks during the company’s Build: AI Day event in Kuala Lumpur, Malaysia, on May 2, 2024. Photo: EPA-EFE
“The new capacity that needs to be built in the Asia-Pacific in the next three to five years is simply mind blowing. My expectation is that deal flow in the data centre space will intensify in 2024.”
Telkom Indonesia is open to strategic partnerships to bring its data centre business arm, NeutraDC, new capabilities and into new markets. Photo: SOPA Images/LightRocket via Getty Images
Other potential deals in Asia include the state-owned Telkom Indonesia’s sale of a stake in its data centre business worth US$1 billion and Japan’s NEC weighing a US$500-million data centre sale, according to news reports.
Telkom’s senior vice-president of investor relations, Ahmad Reza, told Reuters on Wednesday that the company is open to strategic partnerships to bring its data centre business arm, NeutraDC, new capabilities and into new markets.
“We have explored several potential partners, but we are still evaluating for the best one,” Reza said. “We expect to finish this process by the end of this year.”
NEC said it was not able to comment on market speculation.
A number of companies are looking to acquire AirTrunk, an Australian firm that operates 11 hyperscale data centres like this one in Sydney. Photo: AirTrunk
US investment firm Bain Capital is seeking credit financing for the international assets of data centre operator Chindata and investments for its China business, people close to Bain Capital said.
Bain, which took Chindata private from the Hong Kong bourse last year in a US$3.16 billion deal, declined to comment.
Goldman Sachs Asset Management (GSAM), which invested in AirTrunk in 2017 before selling its stake to a Macquarie-led consortium three years later, has deployed more than US$1 billion on data centre developments in Asia over the past three years.
The firm would actively invest in additional projects, with a particular focus on Japan and South Korea, said Nikhil Reddy, head of Asia-Pacific real estate at GSAM.
“AI creates a different type of need for data centres beyond the historic demands of the cloud focused on low latency. Now with AI, which entails massive data consumption, capacity is key,” he said.
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