Aboitiz InfraCapital Inc., the infrastructure arm of the Aboitiz Group, is foraying into the data center business through a partnership with United States-based EdgeConneX.

In a stock report on Wednesday, AIC announced that the joint venture seeks to address rising data usage in the country. It said that the data centers it will build will house cloud service providers' information technology equipment.

The company also disclosed that the initial data center to be set up will be located near the National Capital Region, while a secondary hyperscale campus will be established in the Greater Manila Area.
"Businesses are increasingly turning to cloud service providers — or 'hyperscalers' — for cost efficiency, flexibility, and scalability. Thus, the need for data centers has never been more demanding," said Aboitiz Group president and CEO Sabin Aboitiz.

Landmark deal

"This trend will continue with certainty and speed, and our efforts to seize the opportunities it offers have been proven successful with this latest landmark infrastructure deal for the Aboitiz Group," he added.

Data centers are facilities centralizing an organization's shared IT operations and equipment to store, process, and disseminate data and applications. Since these facilities house critical assets, data centers are important in sustaining the daily operations of a company.

Hyperscale, on the other hand, refers to investments undertaken by big-time technology companies to manage their data requirements.

EdgeConneX provides a full range of sustainable data center solutions worldwide. The company works closely with customers, offering tailor-fit options in terms of location, scale, and type of facility.

Last year, AIC entered the digital infrastructure space through a joint venture tower company called Unity Digital Infrastructure Inc.

BofA Securities acted as AIC's exclusive financial advisor while SyCip Salazar Hernandez and Gatmaitan, Shearman & Sterling, and TSMP served as legal counsel for the company in the transaction.

According to property expert Colliers Philippines, the country, as an emerging data center hub in the region, has $298 million or close to P16 billion in investments in data centers — an indication of the surging demand in  the country for e-commerce, cloud, and 5G services.