KKR, Singtel And Tata Communications Explore $5.5 Billion Sale Of India's Data Centre Business STT GDC India

KKR, Singtel and Tata Communications are preparing to sell their Indian data centre business, STT Global Data Centres India (STT GDC India). The proposed transaction could value the company at more than $5.5 billion. The sale comes as data centre operators expand infrastructure to meet rising demand for digital capacity.

STT GDC India Sale Process And Valuation

STT GDC India is among the country’s three largest colocation data centre providers. It operates 34 data centres across 10 locations, with a combined capacity of 613 megawatts (MW).

The shareholders have appointed advisers to explore a sale. Potential buyers could include international data centre operators, Indian conglomerates and financial investors such as infrastructure-focused funds and private equity firms.

The shareholders had also been evaluating an initial public offering (IPO) in India. The business was being considered for a valuation of $6 billion to $7 billion. The company is expected to fetch at least $5 billion in a sale, slightly below the earlier IPO valuation range.

Data centre assets in the Asia-Pacific region have reportedly been valued at 18–20 times contracted earnings before interest, taxes, depreciation and amortisation (EBITDA). The acquisition of Australia’s AirTrunk by Blackstone and the Canada Pension Plan Investment Board in September 2024 was valued at 22–23 times contracted EBITDA.

STT GDC India’s Business And Data Centre Growth

STT GDC India is a joint venture between STT Telemedia and Tata Communications, with respective stakes of 74% and 26%. STT entered India in 2016 by acquiring a controlling stake in Tata Communications’ data centre business. The transaction valued the business at ₹3,140 crore and included 14 data centres.

Hyperscale cloud providers account for approximately 75% of STT GDC India’s revenue. Its customer contracts typically span seven to 15 years.

According to Tata Communications’ annual report, STT GDC India reported revenue from operations of ₹2,747.5 crore in FY26, up 17.8% from ₹2,331.8 crore a year earlier. Profit declined 22.9% to ₹126 crore, while net assets increased 30.7% to ₹5,760.5 crore.

India’s data centre capacity is expected to increase from 1.26 gigawatts (GW) to more than 2 GW by 2027. The sector’s investment requirements are also rising as cloud and artificial intelligence infrastructure expands.

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