Singtel, KKR to acquire 81.7% of STT GDC in $6.6b cash deal

Effective stakes are split 25% for the telco and 75% for the private equity firm.

Singapore Telecommunications Limited (Singtel) and funds managed by KKR have agreed to acquire approximately 81.7% of ST Telemedia Global Data Centres (STT GDC) from STT Communications for $6.6b in cash.

The acquisition will be carried out through a consortium formed by Singtel’s wholly owned subsidiary, Singtel Interactive, and KKR Opal Topco LP, a fund managed by KKR affiliates, according to a bourse filing dated 4 February.

The consortium will acquire the shares via Opal Bidco Pte. Ltd.

The purchase consideration will be paid in two tranches, with $3.3b payable at completion and the remaining $3.3b payable on the earlier of the first anniversary of completion or a subsequent monetisation event that results in a change of control of the STT GDC group.

Completion is subject to customary conditions, including regulatory approvals.

Upon completion, Singtel will hold an effective equity interest of approximately 25% in STT GDC on a fully diluted basis, whilst KKR will hold about 75%.

Singtel has committed $740m in equity to the acquisition vehicle, funded from internal cash resources. The balance of the consideration will be funded by KKR’s equity investment and debt financing.

Meanwhile, the purchaser has secured debt facilities of $5b to fund the transaction, future capital expenditure, and corporate purposes.

The Bank of America acted as lead financial advisor to the KKR–Singtel consortium.

Based on STT GDC’s audited financial statements for the year ended 31 December 2024, the group recorded a net loss of $185m. As of that date, it had a book value of $5.3b and net tangible assets of $4.7b.

Singtel said the transaction is not expected to have a material impact on the group’s earnings per share.