PLDT, the telecommunications firm in the Philippines, is reportedly discussing the potential sale of nearly half (up to 49%) of its data center business to Japan's Nippon Telegraph and Telephone (NTT), according to PLDT Chairman, Manuel Pangilinan.
According to two individuals familiar with the situation (who requested anonymity due to the confidential nature of the discussions), this transaction could value the data center business at around USD 750 million.
PLDT refrained from providing any comments regarding the valuation, while NTT did not respond to inquiries for comments. According to data from LSEG, NTT holds the position of Japan's largest phone company, boasting a market value of USD 99.9 billion.
One individual mentioned that PLDT intends to utilize the proceeds to reduce debt and support ongoing (and future) data center ventures. As per another source, a potential agreement could be finalized in the latter half of this year.
Established in 1928, PLDT stands as the Philippines' largest telecommunication conglomerate, encompassing various sectors such as fixed line and wireless telephony, as indicated on its website.
Headquartered in Makati City, PLDT possesses and manages 11 data centers through its subsidiary, ePLDT. Spanning various locations in the Philippines including Cebu, Clark, Davao, Manila, Santa Rosa, Subic, and Sucat, PLDT's data centers are well-distributed. Moreover, the company is actively involved in the development of its 12th data center in the nation, featuring a substantial 100MW IT capacity.
PLDT's contemplation of selling its data center business isn't a novel development. Back in 2021, there was a proposal to sell the data centers for USD 500 million, although the deal was postponed. Notably, NTT supported the deal during that period.
In March 2023, as part of its strategy to gather funds for network expansion, PLDT reached an agreement to sell over 1,000 telecom towers to KKR. This move highlights the telco's commitment to enhancing its network infrastructure.
According to LSEG data, PLDT's share price has seen a year-to-date increase of 5.6%, culminating in a market value of USD 5.09 billion.
A potential deal would underscore the increasing interest in Southeast Asian data centers, propelled by a rising digital population and the expanding adoption of artificial intelligence. This trend is expected to enhance growth prospects in the region.
