Princeton Digital Group (PDG) is looking to buy existing data centre companies, carving out operations from telecoms operators and building greenfield centres, according to CEO and founder Rangu Salgame (pictured).
“There’s a market gap we are able to meet,” Salgame told Capacity, following $360 million of new investment, announced today, from the Ontario Teachers’ Pension Plan and Warburg Pincus.
Private equity investor Warburg Pincus has already put $500 million into PDG and today will add another $60 million, said Salgame.
The Ontario teachers are coming into the business for the first time, with $300 million.
“This gives us a tremendous level of debt capacity – a very large pool of dry powder to be able to invest,” Salgame said. He estimated the new investment will mean that PDG can spend “$1 billion over the next two to three years”.
PDG runs data centres in China, India, Indonesia and Singapore. “We will be going deeper into those four markets and we’ll be entering new markets in Asia, like Japan and South Korea as well as others.”
The company will continue the three approaches it has used since Salgame, a former senior executive with Tata Communications, set it up: acquisition, carve-outs from telcos and greenfield operations.
“Over three years we have started 18 data centre projects of which nine are operational today,” he told Capacity. “We have 350MW of capacity at the moment. The tenth data centre will go into service in December. We have 350MW worth of projects.”
PDG is focusing on hyperscale users, he added, “the 10-20 leading internet companies with a small sliver of enterprise”.
Salgame wants to stay in the Asia-Pacific market, south as far as Australia. “We have looked at deals in Australia. It’s something we keep an eye on,” he said.
“Investment is now dramatically going up. Over the next ten years we are going to see a lot of data centre activity in Asia and we are very well positioned.”
Salgame set up PDG in 2017 with Varoon Raghavan and investment from Warburg Pincus.
It entered China in 2018 through a joint venture with 21Vianet for three large-scale developments in Beijing, Xi’an and Guangzhou.
In July 2019 it acquired 70% of XL Axiata’s data centre business, with five data centres in Indonesia, primarily in Sumatra and Java. In September 2019 it bought 100% the DCSG facility in Singapore.
