Mukesh Ambani-backed Reliance to invest Rs 1,000 crore in Brookfield JV

Billionaire Mukesh Ambani-backed Reliance Industries will invest up to Rs 1,000 crore in building data centres along with Canada-based Brookfield Infrastructure.

The announcement comes at a time when data centre capacity in the country is expected to grow exponentially as more people go online.

"The partnership will help us serve our enterprise and SMB clients with cutting-edge, plug-and-play solutions delivered from the cloud, lead their digital transformation, and make them more competitive and efficient. The unique and highly engaging consumer and home experiences that we are offering and further innovating on, such as high-definition live content, AR and VR experiences, cloud gaming, immersive shopping experiences, and cloud PC, have massive compute capacity requirements," said Kiran Thomas, CEO, Jio Platforms Limited. 

Initial investment 

Initially, the company will invest about Rs 378 crore in units of Mercury Holdings SG Pte, a joint venture (JV) between Brookfield Infrastructure and Digital Realty, a US-based real estate investment trust.

Currently, the JV is building data centres in Mumbai and Chennai. The company has committed to investing the remaining Rs 622 crore in equity and debt securities of the JV's units when needed.

"We are very pleased to expand our existing partnership with Reliance and add their deep expertise in the Indian telecom, tech, and data landscape to the platform. Data centres provide essential services and critical infrastructure to support the digitalisation that is taking place in every aspect of life in India. Together with Reliance and Digital Realty, we look forward to providing the best of solutions to the digital transformation needs of Indian and global corporates," said Arpit Agrawal, Managing Director, Head of Infrastructure, India & Middle East, Brookfield

A 33.33 per cent stake will be held by Reliance in each of the units of the venture and it will become an equal partner. The venture will be branded as Digital Connexion.

Data centre market 

The country's data centre market is expected to grow 40 per cent a year and draw $5 billion in investments by 2025, according to a report from investment bank Avendus Capital.

"India is a mostly untapped market for the data centre industry, driven by the rapid adoption of digital business models, the world’s largest population, and a government that recognises the role of technology for future economic development. This joint venture brings together three global leaders in digital infrastructure to accelerate Digital India by developing, owning, and operating institutional-quality carrier and cloud-neutral data centres across India," said Serene Nah, Managing Director and Head of Asia Pacific, Digital Realty. 

The data centre space is also heating up with Reliance's entry, as Adani Enterprises' JV has already raised $213 million to fund under-construction data centres.

(With Reuters inputs)