Permira Said to Seek Buyers for Africa's Largest Data Center Operator Teraco

Gillian Tan, Kiel Porter and Loni Prinsloo (Bloomberg) -- Permira is working with an adviser to find a buyer for its data center company Teraco Data Environments Pty Ltd., people with knowledge of the matter said.

The Johannesburg-based company, Africa’s largest data center operator, could fetch anywhere from $600 million to $1 billion including debt in a sale, said three of the people, who asked not to be identified because the information is private.

No decisions have been made and the London-based private equity firm may elect to keep Teraco, the people said.

Representatives for Permira and Teraco declined to comment.

The company could attract interest from private equity and industry-focused investors including General Atlantic and Digital Bridge Holdings, as well as other data center owners, the people said. General Atlantic and Digital Bridge declined to comment.

In addition to Johannesburg, Teraco also operates data centers in Cape Town and Durban. Permira backed a management buyout of the company in 2015, according to the firm’s website. Teraco’s clients include China Telecom Global Ltd. and Amazon Web Services, its website shows.

Institutional investors have been drawn to data centers, partly because technology is increasingly more integral to consumers and businesses. Demand for associated data storage and services is seen as protecting the industry from a potential cyclical downturn.

Brookfield Asset Management Inc.’s infrastructure arm agreed in June to buy data center operations from AT&T Inc. In September, Brookfield backed Digital Realty Trust Inc.’s purchase of Brazilian data center provider Ascenty in a deal valued at about $1.8 billion.