Keppel T&T's Alpha DC Fund buyout gives 7% boost to earnings

That translates to $3.9m contribution at 50% utilisation.

Keppel Telecommunications and Transportation (KPTT)'s profit has started to snowball via the Alpha Data Centre Fund (ADCF), with its maiden acquisition in Frankfurt providing a 7% boost to earnings as expected, said UOBKayHian

ADCF had on 11 Nov 16 made its maiden acquisition of a data centre in Frankfurt for €76m. The data centre comes almost immediately occupied at 50% and the acquisition serves as an example of how ADCF bolsters KPTT ability to acquire income-generating assets, while minimising
greenfield asset risks, notes the research house.

Here's more from UOBKayHian:

Based on our research, we understand that the data centre is Citigroup’s ex-Frankfurt Data Centre. For KPTT’s 36.4% stake, the data centre adds an additional 7% to earnings (S$3.9m) at 50% utilisation. At full utilisation, this number rises to S$7.9m.

KPTT will be able to charge development fees for the project. This is a fixed percentage of fund management remuneration payable to Alpha by ADCF during the duration of the sub-advisory services agreement.

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