South Africa’s Teraco eyes data centres in Kenya and Nigeria

South Africa’s Teraco eyes data centres in Kenya and Nigeria

Teraco Data Environments, Africa’s largest data centre provider, is considering expanding to Kenya and Nigeria. The Company’s CEO Jan Hnizdo revealed the report and said that the two countries have the liberalised telecoms sectors that data centres need and further added that the could create data centres of between 1MW and 4MW in those countries.

“African data centres have the potential to become a continent-wide growth industry. Growing numbers of African internet users make it harder to serve the continent’s needs via offshore data centres in Europe or the US. Local capacity means faster connections speeds, and Africa’s data centre market is set to grow at a compound annual rate of more than 12% to reach US $3bn in 2025, according to Turner & Townsend. Growth in the provision of undersea cables for Africa has meant increased use of public clouds from providers such as Amazon and Huawei,” said Hnizdo.

Unevenly distributed centres

According to the Africa Data Centres Association and Xalam Analytics, more than 30 facilities have come online in Africa since 2016, doubling the region’s capacity. But that capacity is unevenly distributed, their study shows. More than two-thirds of Africa’s capacity was in South Africa in 2020, and only a third of Africa’s 80 cities with a population of more than 1 million have their own data centre.

South Africa continues to dominate the data centre construction market in Africa, with Kenya and Nigeria also seeing increased investment levels during 2019. The aggressive investments being made in data centre infrastructure in South Africa in anticipation of increased demand in cloud services will likely continue in 2021, with service providers expecting an increase in data traffic as a result of more submarine communications cables coming to Africa.

The company has currently secured US $168m in loans from lenders led by South African bank Absa for the construction of a 38MW hyperscale data centre in Ekurhuleni, east of Johannesburg.This will be Africa’s largest data centre.

Private-equity investor Actis are also planning to invest US $250m into African data centres over three years. It started in March 2020 by buying control of Rack Centre in Nigeria. Nigeria is one of the African governments that requires data to be hosted locally for key sectors.


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