The funds will be used to expand the data centre’s business across Southeast Asian markets including Singapore, Indonesia and Thailand.

KKR says it is making this investment as part of its Asia infrastructure strategy.

“Robust digital infrastructure…will play a crucial role in enabling Southeast Asia’s flourishing digital economy, and Singapore is well-placed to serve as a central hub for the region,” said David Luboff, partner and head of Asia-Pacific infrastructure at KKR, in the statement.

The Southeast Asian data centre market is expected to grow by 17% over the next five years compared to 12% for the rest of the world, with US$9 billion to US$13 billion in investments projected to flow into the region.

Data centre capacity in the region is poised to increase at a compound annual growth rate (CAGR) of 19% from 2021 to 2026 and demand is expected to outpace supply driven by increased data consumption, enterprises transitioning to the cloud and the rapid rise of AI in the region.

Arthur Lang, CFO at Singtel said: “The data centre industry is growing at an accelerated pace given the unprecedented industry trends we are witnessing.

“KKR is a highly credible partner in the data centre space and we look forward to our strategic partnership in scaling up the platform to become a meaningful growth engine for Singtel.

“The investment by KKR crystallises the latent value of our data centre assets and we hope this illuminates value for our shareholders in the coming months.

“With more than S$6 billion being unlocked since we embarked on our strategic reset two years ago, we continue to focus on unlocking value for our shareholders.”

The transaction is expected to be completed by the fourth quarter of 2023, subject to regulatory approvals and customary closing conditions.