New Investment by Telkom in STS and SCC for the Establishment of the Largest Data Center and IT Services Companies in Indonesia
Congratulations to PT Telekomunikasi Indonesia (Persero) Tbk. (Telkom), PT Telkom Data Ekosistem (TDE) and PT Sigma Cipta Caraka (SCC) for the completion of the largest Indonesian data center and IT services restructuring transaction with a total deal value of IDR6.7 trillion.
The deal was especially complex because it involves multiple interrelated transactions where Telkom provides additional major investments in both SCC (for IT services and technology) and STS (for data center) making both companies as direct subsidiaries of Telkom via acquisition under Indonesian law, and SCC spins-off its data center business into TDE, transforming into a full fledge IT service business, and making TDE as Telkom group’s new champion for data center business.
Led by our Managing Partner, Pramudya A. Oktavinanda and Senior Associate, Andika Setia Budi, we are especially proud to act as the leading legal counsel for Telkom in structuring, drafting and finalizing all the transaction documents for this challenging transaction, including developing novel transaction structures that allow smooth transfer of new assets and technologies, novation of liability under bank debts with security over the transaction assets, and transfer of hundreds of contracts with customers and vendors, all within a very tight timeline! More importantly, the transaction will also serve as an important new precedent for future spin-off transactions in Indonesia as we anticipate that more and more companies will be interested to use spin-off for their business reorganizations.
Congratulations once again to all the parties involved and may this transaction bring a significant progress for Indonesia’s TMT industry. There is no doubt that this is the industry of the future and we are at the forefront of it!
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