Bharti Airtel will seek shareholders approval for sale of its Data Center and Managed Services (DCMS) business to its wholly-owned subsidiary Nxtra Data Ltd for about Rs 177 crore.
"To enhance focus and develop capacity and capability across geographies in order to build scale, ability to meet customer demand and develop products to meet customer requirements, the company has decided to undertake the Data Center business through a separate entity," the company said in a BSE filing today.
According to the filing, the sale/transfer consideration shall not be less than Rs 1,771 million (Rs 177.1 crore).
"The transfer consideration has been arrived at on the basis of enterprise value of the DCMS business after reducing the liabilities in relation to the said business," it added.
Bharti Airtel owns seven operational data centres across the country. Out of them, two are in Noida, one each in Chennai, Bangalore, Pune, Bhubaneswar and Mumbai.
The company's board of directors approved the transaction during their meeting held on July 30.
In this regard, Bharti Airtel has also entered into a Memorandum of Understanding with Nxtra Data Ltd.
"Due to the increasing awareness and acceptance of key products such as co-location, managed hosting and managed security, the demand of DCMS is continually evolving in the country.
"The overall market is forecast to grow rapidly driven by demand for remote compute, storage and security services and products such as Hosted Private Cloud (IaaS)," the filing said.
DCMS division offers a gamut of services, including co-location, managed services and managed back-up & storage.