Princeton Digital Group invests US$100 million in XL Axiata’s Indonesian data centre portfolio

Singapore-based Princeton Digital Group (PDG), a Warburg Pincus-backed investor, developer and operator of Internet infrastructure, has reached a definitive agreement to acquire a 70% stake in XL Axiata’s data centre portfolio. XL Axiata, Indonesia’s second-largest telecommunications company, owns five data centres across Indonesia.

The joint venture, Princeton Digital Group Data Centres, enables PDG to establish a strategic presence in Indonesia, which is poised to become the largest digital economy in Southeast Asia by 2025*. The new entity will be a carrier-neutral data centre operator that aims to serve hyperscalers, domestic unicorns, enterprises, and telcos.

“PDG’s plans including expanding capacity in the existing data centres as well as building one large hyperscale data centre later this year. With further investments in the coming years, we see this JV becoming the undisputed market leader in Indonesia and one of the largest operators in Southeast Asia.

"For PDG, the goal is clear – we are leveraging our unmatched experience in scaling global Internet infrastructure to build a pan-Asian multibillion-dollar digital infrastructure portfolio. Today’s announcement is a significant step in that direction,” said Rangu Salgame, Chairman and CEO, Princeton Digital Group. 

“Our depth of local knowledge and strong experience operating in the Indonesian telecommunications industry, combined with the extensive expertise and experience of the PDG team in the global telecom and technology sphere make Princeton Digital Group Data Centres a compelling partner of choice to hyperscale digital services providers and multinational enterprises who are rapidly expanding their operations in Indonesia and across the region,” said Dian Siswarini, President Director and CEO, XL Axiata.

Indonesia's digital economy is set to dominate Southeast Asia by 2025 as its market value triples to US$100 billion from US$27 billion in 2018 (Google-Temasek)*. Global public cloud service providers such as Alibaba Cloud, Amazon Web Services and Google Cloud are already building strategic hubs in the market. Data centers are the backbone of this phenomenal growth. Across Southeast Asia, the data centre market is poised for major advances and is expected to more than double its value in the next four years. According to Technavio, the data centre market in the region will grow at a CAGR of around 14% from 2017 to 2021**.

*E-Conomy SEA 2018, Google and Temasek research on the Internet economy in Southeast Asia (PDF)

**Data Center Market in Southeast Asia 2017-2021, Technavio