Colt targets new data centre investment in Hong Kong

Colt Group plans to pursue acquisitions and investments in Hong Kong and on the mainland after completing its 18.6 billion yen (HK$1.25 billion) takeover of Japanese data-centre services operator KVH.

"The KVH acquisition provides us with a launch pad into Asia, where there are higher-growth markets for information and communications technology services," said Rakesh Bhasin, the chief executive of the European information and communications technology services provider, yesterday.

"We have no debt on our balance sheet, and we can easily raise up to €300 million (HK$2.9 billion) to tap opportunities in the Asia-Pacific … we will be adding [data centre] capacity in Hong Kong, as well as work with mainland regulators and local governments on [investment] opportunities in the broader China market."

London-based Colt's purchase of KVH followed the European firm's corporate restructuring early this year, which involved its withdrawal from the low-margin carrier voice-trading business. Its four main businesses now cover network, data centre, information technology and voice, in selected markets.

The deal, which is expected to close next month, is a related-party transaction as US financial services group Fidelity Investments and associated companies wholly own KVH and control 62.54 per cent of Colt.

Founded in 1999, Tokyo-based KVH operates similar businesses to Colt. KVH has about 2,000 multinational corporations and network services providers as customers across the Asia-Pacific region. It also targets similar information-intensive industries, including financial services, media, telecommunications and internet services, and professional business services, such as legal and insurance.

In a regulatory filing on Wednesday, Colt said the global economic downturn as well as the earthquake, tsunami and Fukushima nuclear disaster in Japan in 2011 affected the demand for network and data centre services in Japan.