Infratil (ASX:IFT) to buy a 40% stake in UK data business

Infrastructure investment company Infratil (ASX:IFT) will buy a 40 per cent stake in the London data centre business Kao Data, in a $224-242 million (£120-130 million) deal.

Infratil will obtain a 40 per cent stake alongside current owners, Legal & General Group and Goldacre who each retain a 30 per cent stake. Legal & General is a European financial services and asset manager, while Goldacre is the founder of Kao Data and part of a family run investment house Noe Group.

Infratil, together with their partners, intend to build Kao Data into a $934 million (£500 million) ‘multi-site data centre platform.’ Kao Data owns a 15-acre data centre campus in Harlow, north of London. Infratil notes that Kao has built one data centre on that campus, with construction of a second to begin this financial year. Once fully developed, the campus will be home to four energy efficient data centres, all powered by 100 per cent renewable energy

Kao’s data centres are designed to meet their specialist computing requirements. Kao’s first data centre houses Nvidia’s Cambridge-1 provides computing capacity to healthcare companies such as AstraZeneca and GSK.

“With global demand for connectivity continuing to rise, this is an excellent opportunity to expand our digital infrastructure portfolio and build on our successful data centre platform investment in Australia and New Zealand,” said Infratil CEO Jason Boyes.

“It is a rare opportunity to invest in one of the fastest growing data centre markets in the world, alongside blue chip partners. We will bring our sector experience alongside our partners’ capability and relationships to continue to scale up this business, with the aim of delivering a sizeable multi-site platform.”

“We look forward to working with the Kao Data management team and existing shareholders to continue the build out of best-in-class, high-performance, sustainable data centre solutions and scale up the platform through attractive growth opportunities in the pipeline,” said manager Vincent Gerritsen.

Shares in Infratil (ASX:IFT) are trading 2.1 per cent higher at $7.94.