 "Tata Communications sells 74% in data centre to ST Telemedia")
Tata Communications will continue to hold 26% stake in the company. With cloud becoming the future, Tata Communications has decided to sell stake in the data centre business. While the deal size has not been disclosed, the street estimates it to be $650 million. Singapore Technologies Telemedia is an arm of Temasek Holdings.
With this acquisition, STT GDC will expand and strengthen its global data centre network to span four geographies, including strong bases in two of Asia's largest growth markets - India and China.
Tata Communications will retain a stake in the co-location market in these important markets, to stay focused on the development and introduction of its advanced managed services portfolio (including IP, cloud enablement and unified communications services). The company will also continue to invest in its strategic partnerships globally.
The joint venture will now house Tata Comm's fourteen data centres in key cities across India and its three Singapore facilities. The data centres currently service a highly-diversified customer base, including blue chip enterprises in Asia, e-commerce platforms and global multi-national corporations. Both parties will work in partnership to ensure service continuity for customers and employee engagement.
Vinod Kumar, Managing Director and CEO, Tata Communications, said: "Today marks a milestone moment in Tata Communications' evolution. We have been proud of the tremendous growth of our data centre subsidiary over a relatively short time. This new joint venture partnership will now allow us to hone our strategic focus on advanced services within the data centre that enable digital transformation for our customers, in addition to infrastructure services. Our new partnership also gives us the opportunity to redeploy capital behind other areas of our business, to further broaden the portfolio of services we can offer to meet our customers' current and future requirements."
In 2014, the Indian data centre business of Tata Communications was transferred to its wholly-owned subsidiary Tata Communications Data Centers Private Limited (TCDC) through a High Court approved process. Today, TCDC owns and operates a total of fourteen data centres, including facilities in Delhi, Mumbai, Bengaluru, Chennai, Kolkata, Hyderabad and Pune.
Sio Tat Hiang, Executive Director, ST Telemedia, said: "Since ST Telemedia's initial investment in the data centre business in mid-2014, we have made remarkable progress in building a formidable data centre footprint internationally with strategic presence in key economic hubs to capture industry demand. The latest addition of India to the STT GDC network will be a major impetus to advance the company's ambition to be a significant global data centre service provider."
Rangu Salgame, CEO of Growth Ventures and Service Provider Group, Tata Communications, added: "We're delighted to be partnering with STTelemedia to create this exciting joint venture, bringing together two great brands. Our companies share a very similar ethos and set of values: both organisations are long term investors, focusing on performance, value and growth. Both organisations also share an impeccable commitment to customer service excellence. Looking ahead, I am confident that our customers can expect the same high levels of service as they receive today and a partner who will bring additional offerings to enable their cloud and ecommerce growth. It is this aligned commitment to our customers that makes this strategic partnership so compelling."
