KKR and Singtel to acquire full control of STT GDC in S$6.6 billion AI-driven data centre deal

Summary

A consortium led by KKR and Singapore Telecommunications will acquire full ownership of ST Telemedia Global Data Centres in a S$6.6 billion (about US$5.1–5.2 billion) cash deal, valuing the company at an implied enterprise value of S$13.8 billion. The landmark transaction is the largest data centre deal in Southeast Asia and Singapore’s biggest M&A in four years, underscoring surging investor demand for AI-ready digital infrastructure.

A consortium led by KKR and Singapore Telecommunications (Singtel) will pay S$6.6 billion in cash to acquire the remaining 82% stake in ST Telemedia Global Data Centres (STT GDC) from its founding shareholder ST Telemedia.

The transaction implies an enterprise value of S$13.8 billion, making it the largest data centre acquisition ever in Southeast Asia and one of the biggest digital infrastructure deals globally in recent years. It highlights intensifying competition among global investors to secure platforms that can support booming demand for artificial intelligence, cloud services, and high-density computing.

Ownership structure and financing

After completion, KKR will hold 75% of STT GDC while Singtel will own 25%, taking into account the conversion of existing redeemable preference shares.

The buyers have secured roughly S$5 billion in debt facilities to fund the acquisition and future expansion. Singtel will invest S$740 million in equity, financed through internal cash resources, and has said the deal is not expected to materially affect its credit rating or dividend policy.

A major bet on AI and digital infrastructure

Founded in 2014 and headquartered in Singapore, STT GDC operates around 2.3 gigawatts of design capacity across 12 major markets spanning Asia-Pacific, the UK, and Europe. The company provides colocation, connectivity, and 24/7 operational services for hyperscale cloud providers and large enterprises.

The scale and geographic reach of the platform have become increasingly valuable as AI workloads drive soaring demand for power-intensive, highly reliable computing environments.

Investors across the globe are rapidly pouring capital into data centres, viewing them as essential infrastructure for the digital economy — much like energy grids or transport networks.

Strategic fit for Singtel

For Singtel, the acquisition significantly strengthens its push beyond traditional telecom services into higher-growth digital infrastructure and enterprise platforms.

Analysts note that large-scale data centres offer long-term recurring revenue, strong pricing power, and deep integration with cloud ecosystems — aligning closely with Singtel’s ambition to build sustainable growth engines for the next decade.

Singtel shares rose to record intraday levels following the announcement before trimming gains later in the session, outperforming the broader Singapore market.

Temasek-linked seller steps back

ST Telemedia — an indirect subsidiary of Temasek Holdings — is exiting majority ownership as part of a strategic transition, while welcoming KKR and Singtel as long-term partners to drive the next phase of expansion.

The consortium had already invested S$1.75 billion in mid-2024 for a minority stake, setting the stage for this full buyout.

Timeline

The transaction is expected to close in the second half of 2026, subject to regulatory approvals and customary closing conditions.

Why This Matters

This deal signals a turning point in the global race for AI-ready digital infrastructure. Data centres are becoming the backbone of artificial intelligence, cloud computing, and enterprise digital transformation.

By locking in control of a massive, geographically diversified platform, KKR and Singtel are positioning themselves at the center of one of the fastest-growing infrastructure sectors in the world. The acquisition is also likely to trigger further consolidation as investors compete for scarce, power-secured, large-scale data centre assets across Asia and Europe.

FAQs

Q1. Why are KKR and Singtel buying STT GDC?

To expand aggressively into high-growth digital infrastructure, especially data centres critical for AI, cloud computing, and enterprise services.

Q2. How big is the deal?

S$6.6 billion in cash, implying an enterprise value of S$13.8 billion.

Q3. What does STT GDC do?

It develops and operates large-scale data centres across Asia-Pacific, the UK, and Europe, providing colocation and connectivity services.

Q4. How will ownership be split?

KKR will own 75% and Singtel 25% after completion.

Q5. How is the acquisition financed?

Through roughly S$5 billion in debt facilities and Singtel’s S$740 million equity investment.

Q6. When will it close?

Expected in the second half of 2026, subject to regulatory approvals.

Q7. Why are data centres attracting so much investment?

AI and cloud computing require enormous power and computing capacity, making large-scale data centres critical infrastructure for the global digital economy.