Local data centre provider Digital Edge acquires Indonesia's Indonet for US$165m

SINGAPORE-BASED data centre provider Digital Edge on Tuesday announced that it has acquired a controlling interest in Indonesian digital infrastructure service provider Indonet for US$165 million.

The acquisition was done through its wholly-owned subsidiary Digital Edge (Hong Kong), and the firm will be the single largest shareholder in Indonet.

"This strategic partnership marks our initial entry into South-east Asia. It enables Digital Edge to meet the pressing needs of new customers wanting to deploy into Indonesia, and also to offer Indonesian firms a strong regional platform to expand outside of the country," said Samuel Lee, chief executive of Digital Edge.

Founded in 2020, Digital Edge is backed by Stonepeak Infrastructure Partners. Its management team last August announced a US$1 billion equity capital commitment to the platform along with Stonepeak and its investors. Mr Lee, who leads Digital Edge, previously served as president of Equinix's Asia-Pacific business from 2005 to 2019.

The company's focus lies in acquiring and developing carrier-neutral data centres and related digital infrastructure assets across the Asia-Pacific region. Its portfolio currently spans six data centres across four metros - three in Tokyo, one in Seoul, one in Busan, and an upcoming facility in Osaka that is scheduled to open in Q1 2022.

Indonet, which was established in 1994, is Indonesia's first commercial Internet service provider. It owns self-built fibre assets in the Jakarta area, and offers Internet connectivity, local loop, cloud access and co-location services.

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Indonet had most recently, through one of its subsidiaries, commissioned a data centre facility in Jakarta, called EDGE1 data centre.

Toto Sugiri, founder and chairman of Indonet, said: "Together with Digital Edge, Indonet is best placed to capitalise on the market growth of Indonesia. In fact, we are already looking at the next round of expansion projects."

Based on data from Structure Research, Jakarta's co-location market is expected to reach US$625 million by 2025, with a compound annual growth rate of 23.7 per cent between 2021 and 2025.

"With its full suite of telecom licences, extensive dark fibre assets, network services and central location of its EDGE1 data centre, Indonet will enable Digital Edge to develop sophisticated solutions for its interconnect-focused customers, such as network, cloud, and financial services customers," said Andy Rigoli, chief operations officer at Digital Edge.