Mr. Montri Khongkruephan, Chief Finance Officer of Advanced Info Service Public Company Limited (SET: ADVANC), reported that the Board of Directors Meeting held on 27 January 2025, has approved AIS DC Venture Company Limited (AISDC), Fax Lite Company Limited (FXL), and Advanced Wireless Network Company Limited (AWN), subsidiaries of the ADVANC, to enter into connected transactions with GSA Data Center 02 Company Limited (GSA02), a subsidiary of GSA Holdings Company Limited (GSA Holdings), a joint venture in which ADVANC holds a 25% equity stake, alongside ADVANC’s major shareholders: Gulf Energy Development Public Company Limited (GULF), holding a 40% equity stake and Singtel Strategic Investments Pte Ltd. (Singtel), holding a 35% equity stake.
The transaction consists of (1) financial assistance in proportion to the shareholding, amounting to 125 million baht; and (2) the sale of land, amounting to 145.2 million baht, the total transaction value is 270.2 million baht.
The details of the transaction are as follows: AISDC, a subsidiary of ADVANC, has provided financial assistance in proportion to shareholding under general commercial terms to GSA02 in the amount of 125 million baht in proportion to a 25% shareholding from the total loan amount of 500 million baht. Its purpose is to provide financial support for expenses incurred during the pre-construction phase of the Data Center.
As for the interest rate, the terms are determined based on the cost of capital of each shareholder and are aligned with the Minimum Loan Rate (MLR) of commercial banks in accordance with the agreement between the provider and the recipient of financial assistance. The repayment is expected after 3 years from the initial drawdown or upon demand.
The overall objective of these transactions is to support the expansion of the data center business, in which ADVANC has invested through GSA Holdings, aligning with the rapid growth of the market. This is particularly aimed at meeting the demands of Hyperscale customers, a segment with high growth potential, offering an opportunity to generate returns in proportion to ADVANC’s equity stake. Additionally, it maximizes the utilization of unused land, ensuring optimal benefit.
As for the benefit the company expects to receive, GSA Holdings, an investment company specializing in the data center business, has identified significant opportunities and market trends in the rapidly growing data center sector. To capitalize on this potential, funding is required to support the development of its data center construction project under the GSA02. This project aims to meet the increasing demand for data center services to Hyperscale clients, a segment experiencing robust double-digit growth. (According to the DC Byte report, the average growth rate of Hyperscale client demand in the APAC region stands at 18%.) ADVANC anticipates long-term benefits from GSA02’s performance, proportionate to ADVANC’s equity stake in the joint venture.
Furthermore, this project will enhance ADVANC’s competitiveness in providing enterprise services by building upon its connectivity services to deliver data center solutions.
In terms of land sales, FXL sold land with an area of 12-0-39.25 rai, located in Chonburi Province, to GSA02 for 145.2 million baht. This price is based on the appraised value provided by Knight Frank Chartered (Thailand) Company Limited, an independent appraisal company approved by the Securities and Exchange Commission (SEC).
ADVANC expects the sale of this land to create added value by enabling its development and construction into a data center. This initiative aims to support and address the growing expansion of the data center market. Additionally, the Company anticipates long-term benefits from the project’s performance in proportion to its equity stake in the joint venture.
