Khazna to open $250m data centre in Egypt amid global acquisition plan

Abu Dhabi’s Khazna Data Centres, one of the industry’s largest operators in the Middle East, will be expanding in Egypt and is considering acquisitions to boost its portfolio amid a shifting digital landscape, its chief executive has said.

The $250 million Egypt data centre, to be built at Maadi Technology Park in Cairo with an expected capacity of 25 megawatts of IT load, is aimed at addressing the region’s underserved markets in terms of data capacity, Hassan Al Naqbi told The National.

“We realise that to become regional and global, we have to step outside the UAE,” Mr Al Naqbi said. “It’s inevitable … we’re looking at emerging markets where we see the shift of data and cloud concentration going into those regions.

“We plan to do organic [growth] or greenfield [investments], but in some cases we might do activities in which we acquire some existing players and try to expand from them.”

Khazna – created when the former Etisalat Group and Abu Dhabi artificial intelligence company G42 merged their data centres in 2021 – is entering the Egyptian market with Cairo-based Benya Group.

“Egypt is … sort of a gateway between East and West. A country like Egypt with a huge population has a lot of potential,” Mr Al Naqbi said.

The company is also in discussions with a number of countries, he said.

Khazna is looking into three more markets in Mena – Saudi Arabia, Kuwait and Morocco – and greenfield investments are being planned with the “right partners”, Mr Al Naqbi said.

“High level” talks are under way for entry into Saudi Arabia, the Arab world’s biggest economy, and a specific time frame will be announced once an agreement is finalised, he said.

Middle East countries have become attractive markets for technology investments because of the booming digital landscape in the region.

A number of global technology organisations, including Amazon, Google, Microsoft and Oracle, have set up data centres in the region to support technological push.

Revenue in the global data centre market is expected to jump about 20 per cent to $410.42 billion by 2027, from an estimated $342.1 billion in 2023, data from Statista shows.

Khazna’s expansion in Egypt “will have a substantial impact on attracting investments in high-density operations that support cloud systems and content operators, as well as encouraging major commercial companies to join a topnotch cloud complex”, Ahmed Mekky, chairman and chief executive of Benya Group, said.

Khazna is looking to expand in North Africa and parts of Europe, Mr Al Naqbi said.

In Asia, Khazna is seeking opportunities in Indonesia and the Philippines.

Mr Al Naqbi visited Manila recently and had discussions with a number of potential partners in the country that is also deemed underserved.

“The Philippines has a very young generation using data, but they are not well connected from a broadband perspective because of the many islands it has,” he said.

Khazna currently operates 12 data centres across the UAE, with a planned capacity of 300MW as the company aims to add another 12 over the next two years.

One of these data centres will be a 30MW flagship facility in Abu Dhabi’s Masdar City.

Its first phase will come online in July, with a capacity of 15MW, and the second phase is expected to be delivered in September.

Another 21MW data centre is being developed at Dubai Design District, which is scheduled to be operational in October. The remaining capacity will be delivered before the end of 2024, Mr Al Naqbi said.

“We have been growing steadily, and in the last three years we have at least grown three or four times our normal growth for the past years.”

The Abu Dhabi company is looking into three more markets in Mena – Saudi Arabia, Kuwait and Morocco