Kotak Special Situations Fund to invest Rs1,000 crore in Sify’s data denter business

Kotak Special Situations Fund (KSSF), managed by Kotak Investment Advisors Limited (KIAL), on Monday said that it has agreement with Sify Technologies Ltd, to invest up to Rs1,000 crore ($135 million) in Sify Infinit Spaces Ltd (SISL), a wholly-owned subsidiary of Sify.

SISL is a data centre services player, serving Indian and Global enterprise customers and hyperscalers from its ten operational Data Centres across the country.

Under the transaction, the KSSF investment will be in the form of compulsorily convertible debentures, which will convert into equity based on the operational performance of SISL over a specified reference period. The funds would be used to invest in SISL’s current plan under execution of developing new data centres in Mumbai, Noida, Chennai, Bangalore and Hyderabad and for investment in renewable energy requirements for its operational and new data centres for up to Rs4,000 crore ($530 million).

“India is set for significant economic growth and is becoming the first choice destination for both global businesses and investors. India is witnessing the rise of Information technology-driven entrepreneurship and business growth. The current capacity of the Data Centre industry in India is expanding at an unprecedented pace, powered by wider cloud adoption, 5G rollout and accelerated digital transformation programmes of enterprises,” said Raju Vegesna, chairman and managing director at Sify.
Srini Sriniwasan, managing director at Kotak Investment Advisors Ltd said, “We are delighted to partner with Sify to build out the Data Centre capacity in India and contribute to the goal of a digitally savvy India, based on the strength of Sify’s entrepreneurial capabilities and experienced management team. Data Centres are at the core of the country’s Digital India ambition, and we believe that with vibrant entrepreneurship in the digital space, rich media consumption by an exploding well-connected population and increasing requirements for local storage of data, India’s Data Centre sector is a long term secular opportunity.”
Kotak Investment Advisors Ltd (KIAL), a part of the Kotak Mahindra Bank (Kotak), focuses on the Alternate Assets business. KIAL, set up in early 2005, has raised/managed/advised in aggregate over $4.9 billion across different asset classes including Private Equity Funds, Real Estate Funds, Infrastructure Funds, Special Situations Fund, Listed Strategies and Investment Advisory. Livemint