Philippines’ PLDT in talks to sell up to 49% of data centre business to Japan’s NTT

By Neil Jerome Morales and Yantoultra Ngui

MANILA/SINGAPORE (Reuters) -The Philippines’ largest telecommunications group PLDT (NYSE:) is in talks to sell up to 49% of its data centre business to Japan’s Nippon Telegraph and Telephone (OTC:) (NTT), PLDT Chairman Manuel Pangilinan told Reuters on Tuesday.

The deal could value the data centre business at $750 million, said two people with direct knowledge of the matter, declining to be identified as the discussions were private.

PLDT declined to comment on the valuation. NTT did not respond to a request for comment.

NTT is Japan’s largest phone company with a market value of $99.9 billion as of Tuesday, LSEG data showed.

PLDT will use the proceeds to cut debt and fund ongoing and new data centre projects, one of the people said.

A deal could be reached in the second half of this year, the person said.

Founded in 1928, PLDT is Philippines’ largest telecommunication conglomerate with businesses including fixed line and wireless telephony, its website showed.

Headquartered in Makati city, it owns and operates 11 data centres through subsidiary ePLDT.

PLDT’s share price has climbed 5.6% year-to-date, giving the company a market value of $5.09 billion as of Tuesday, LSEG data showed.

A deal would underscore increasing interest in Southeast Asian data centres as an expanding digital population and the rise of artificial intelligence fuel growth prospects.

In September, global investment firm KKR & Co (NYSE:) bought 20% of Singapore Telecommunications’ regional data centre business for S$1.1 billion ($813.49 million).

($1 = 1.3522 Singapore dollars)