Megawide joins data center race

MANILA, Philippines — From completing a regional airport and an integrated terminal, Megawide Construction Corp. has expanded its portfolio to data centers by formalizing a deal to put up a P16.5 billion facility.

Megawide yesterday informed the Philippine Stock Exchange of the shareholders agreement that it signed with Singapore-based Evolution Data Centres Pte. Ltd. (EDC).

The contract involves the investment in, acquisition, development, construction and operation of data center assets in the Philippines for a total cost of $300 million, or around P16.5 billion.

In particular, Megawide and EDC will work together in putting up a 69-megawatt co-location data center in Cavite. The first phase of the project covers a 23-MW deployment spread for a span of five years inside a four-hectare property.

For the meantime, the parties relayed the transaction to the Philippine Competition Commission for its review and approval. Further, Megawide and EDC are expected to come up with the final conditions for the partnership in the next 120 days.

Once completed, Megawide and EDC will enter into subscription agreements to pay for shares in EDC Philippines Inc., as well as in a new firm that holds the land where the data centers will be located.

After closing, Megawide is expected to own 49 percent of the outstanding capital stock of EDC Philippines and 60 percent in the land holding firm.

Megawide chief business development officer Jaime Feliciano said the infrastructure builder has hopped on the data center bandwagon to serve the rising demand from hyperscalers.

Hyperscalers refer to tech giants like Amazon, Facebook and Google who look for infrastructure where they can store data from their platforms. As the pandemic sped up the transition to digital use, demand for data centers also increased worldwide.

On the other hand, EDC CEO Darren Webb said the Philippines has the potential to attract fresh investments in the data center market. He attributed his optimism to the rising data consumption and growing support for digitalization in the country, factors that could play a role in pulling tech giants to invest here.

Under the partnership, Megawide will lend its engineering and design expertise, while EDC will offer its technical knowledge in the data center industry to deliver the project.