Time for ST Telemedia, Singtel to inject their data centres into Reits?

UP to S$6 billion worth of data centre assets could be spun off into real estate investment trust (Reit) initial public offerings, should CLSA's suggestion in a recent report on a potential restructuring of Temasek's portfolio materialise.

This would follow in the footsteps of Keppel DC Reit, Asia's first data centre Reit. It would also be great news for the Singapore Reit sector - the only sector that seems to be attracting any kind of listings on the local bourse these days.

In a September report, CLSA proposed that Singtel and Temasek unit ST Telemedia inject their data centres into Reits to go asset-light, ease capital expenditure and focus on their core businesses. For Singtel, that would be providing telecommunication services for its consumers and group enterprises; for ST Telemedia, it would be making investments in the communications, media and technology space.