United States-based Carlyle Group will invest $235 million (Rs 1,774.25 crore approximately) to acquire a 25% stake in Bharti Airtel’s data centre business Nxtra Data, the Indian telecom operator announced in a BSE listing on Wednesday.
“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 USD 235 million in Nxtra Data Limited, a wholly owned subsidiary of Airtel engaged in the data centre business,” Bharti Airtel said.
The deal is subject to regulatory approvals, including one from the Competition Commission of India. After the deal, the enterprise valuation of Nxtra will stand at $1.2 billion (approximately Rs 9,084 crore).
Nxtra Data will use the proceeds from the deal to boost its infrastructure and increase its offerings across the country. The firm offers data centre services to leading Indian and global enterprises, start-ups, small and medium businesses and governments.
“Nxtra’s nation-wide 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,” the statement added.
Nxtra is also setting up many data centres across the country. “Last year, the company commissioned a data centre in Pune and is building more across Chennai, Mumbai and Kolkata,” said the company.
Gopal Vittal, the managing director and chief executive officer (India and South Asia), Bharti Airtel, said the company’s top priorities were security and data privacy requirements of customers. “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.
Neeraj Bharadwaj, the managing director of the Carlyle Asia Partners advisory team, said India will soon 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.”
Carlyle has experience in data centre ownership. It has invested in Coresite in the US and Itconic in Spain. In India, Carlyle had invested more than $2.5 billion as of March 31, 2020. “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,” Vittal added.