SingTel - Maybank Research 2023-09-21: Deal Unlocks Value, Potential For Special Dividend

• SingTel (SGX:Z74) has entered into a strategic partnership with KKR to divest up to 20% of its Regional Data Centre (RDC) business for S$1.1b. This values the RDC business at an enterprise value of S$5.5b (translating to 31x FY24E EV/EBITDA) with an option to increase its stake to 25% by 2027 at the pre-agreed valuation. This transaction has unlocked S$2b out of S$6b of latent value within SingTel group.
• - Read this at SGinvestors.io -

Partnership with KKR to increase its global footprint

• Given KKR’s strong track record in global data centre investments and RDC infrastructure capabilities, we believe this synergistic deal is beneficial for SingTel as the group strives to expand regionally while potentially opening up opportunities for the group around the world.
• - Read this at SGinvestors.io -
• SingTel noted that cash proceeds from the sale would give the group flexibility for further expansion for growth (RDC and NCS) coupled with returns to shareholders.

Valuation reflects quality of RDC portfolio

• Read more at SGinvestors.io.

Kelvin Tan Maybank Research | https://www.maybank-ke.com.sg/ 2023-09-21 SGinvestors.io

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