US-based private equity firm, Carlyle Group announced on Wednesday that it will buy a 25% stake in Bharti Airtel's data centre business, Nxtra Data for $235 million (around Rs 1,780 crore). Airtel will continue to hold the remaining 75% stake in the business.
Nxtra will use the proceeds from the stake sale to scale up its infrastructure across the country. The deal will peg the company's post-money enterprise valuation at $1.2 billion, which is over Rs 9,084 crore.
Carlyle will invest in Nxtra through a company called Comfort Investments II, which is an affiliated entity of CAP V Mauritius Ltd., an investment fund managed and advised by affiliated firms of the Carlyle Group.
"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 $235 million in Nxtra Data Limited, a wholly-owned subsidiary of Airtel engaged in the data centre business," Airtel said in a statement.
Meanwhile, Airtel further stated in its statement that the transaction is subject to the necessary regulatory approvals, comprising Competition Commission of India's approval.
Nxtra, which is headquartered in New Delhi, 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.
It highlighted that India is witnessing a considerable surge in demand for secure data centres as businesses undertake digital transformation and consumer demand for digital services continues to increase.
"The expansion of hyperscalers across the region following the government's directive on data localisation is propelling a lot of this demand, with other market drivers including the growth in user data and increase in cloud penetration," the statement stated.
Nxtra is building multiple large data centres to capture significant growth opportunities in the country.