PLDT to monetize data centers

MANILA, Philippines — Telco giant PLDT Inc. is expected to close its partial sale of data centers in 2025, and is gearing up to spend the proceeds on debt payments to strengthen financial standing.

PLDT is currently talking to prospective investors interested in acquiring a minority stake in its data center unit VITRO Inc. as it anticipates that a deal will be signed next year.

PLDT chief finance officer Danny Yu said the negotiations are taking longer than expected, given the due diligence that interested parties have to do before buying into the data centers.

Once an agreement is reached, Yu said PLDT has to submit whatever the agreement would be to the Philippine Competition Commission (PCC) to undergo antitrust review.

As such, Yu believes the telco would be fortunate to sign the deal next year.

“Hopefully, next year (we can reach a deal) because it takes a while. After concluding talks with prospective buyers, you have to go through PCC for approval,” Yu said.

PLDT chairman, president and CEO Manuel V. Pangilinan confirmed a STAR report that equity manager CVC Capital Partners is eyeing a minority share in the data centers.

Right now, CVC owns the exclusive right to talk to PLDT about the data centers, but Pangilinan said the telco has other investors waiting in line in case talks fail to progress.

Prior to engaging CVC, PLDT was negotiating with Nippon Telegraph and Telephone Corp., but hung up the phone on the Japanese telco when it demanded a majority share.

PLDT is searching for a minority investor who would buy 49 percent in its $1-billion portfolio of data centers. Proceeds would be used to settle obligations, as the telco moves to cut its debts as a share of earnings before interest, taxes, depreciation and amortization (EBITDA) to two times.

To date, PLDT owes P272.6 billion in debts to creditors, but 57 percent of it is payable from 2030 onward.

Yu said achieving a debt-to-EBITDA ratio of two times would place PLDT in an industry-leading position.

Debt-wise, PLDT plans to roll over its debts until 2027, although some payments would be made as soon as it monetizes its data centers.

PLDT, through VITRO, leads the data center industry in the Philippines, managing a portfolio of 11 facilities across Mega Manila with a capacity of nearly 100 megawatts.