PLDT preps data center unit for $400-M REIT IPO by Q4

MANILA, Philippines – PLDT Inc. is targeting a fourth-quarter listing of its data center assets under a real estate investment trust (REIT), in a deal that chair Manuel V. Pangilinan said could raise as much as $400 million.

At the company’s annual stockholders’ meeting on Tuesday, Pangilinan said the Vitro REIT initial public offering (IPO) could raise between $300 million and $400 million from an initial portfolio of eight mature data centers with a combined capacity of 27 megawatts.

READ: PLDT eyes REIT listing for data center business

Asked why PLDT opted for a REIT structure, Pangilinan said, “For one, we’re not getting the kind of values we think we ought to get for the data centers.”

Before pursuing the REIT route, PLDT had explored selling a minority stake in its data center business to outside investors. However, most prospective partners—including Japan’s Nippon Telegraph and Telephone Corp.—wanted a controlling stake.

With board approval secured, PLDT is preparing to inject income-generating data center assets under subsidiary Vitro Inc. into a REIT structure, following recent regulatory changes that expanded REIT-eligible assets to include digital infrastructure such as data centers.

IPO proceeds will be used primarily to reduce PLDT’s debt.

The first phase will cover eight facilities, while larger assets, including the flagship Santa Rosa data center, may be added later. PLDT’s Santa Rosa facility alone has a capacity of 50 megawatts.

Based on preliminary estimates, Pangilinan said the eight facilities could command a valuation of between $600 million and $800 million. Santa Rosa alone could be valued at least $1 billion once stabilized and ready for inclusion in the REIT portfolio.

In a disclosure, PLDT said the proposed vehicle would provide a platform to unlock value from its digital infrastructure assets, while creating a sustainable capital-recycling mechanism to support future expansion. INQ