NTT DATA Group Corporation, a partially-owned subsidiary of Nippon Telegraph and Telephone (NTT), has on May 8 approved the transfer of six data centers valued at 240.7 billion yen (US$ 1.57 billion) from a subsidiary to a Singapore real estate investment trust, NTT DC REIT which is proposed to be listed on the Singapore Exchange (SGX) in the near future. The transfer is subject to the proposed listing being approved by the Singapore Exchange and relevant authorities, NTT Data Group said in a filing note to the Tokyo Stock Exchange recently.
The six data centers, with total capacity of 90.7 MW are located in the US (4), Austria and Singapore. They have a total book value of approximately 85.2 billion yen (US$ 557 million), resulting in an estimated transfer gain of approximately 155.4 billion yen (US$ 1.016 billion). The transfer gain of 155.4 billion yen is scheduled to be recorded as revenue in the fiscal year ending March 2026 while a similar amount is expected to be recorded as operating profit, the note added.
Explaining the decision, the board said: “Our group views the expanding global demand for data centers as a business opportunity and has been actively investing in this area. Through the formation and operation of this REIT, we aim to introduce a capital recycling model for data center assets, thereby promoting further growth in our data center business and maximizing corporate value. Our group plans to utilize this REIT as a scheme to accelerate the investment recovery cycle for data centers, generate additional investment funds, and maintain financial soundness. As part of this initiative, we will transfer the Target Assets. Additionally, our group holds other data center assets that can be sold to this REIT in the future, providing us with the option to secure growth capital flexibly while maintaining our balance sheet.”
W.Media has in January reported about the proposed listing.
