09 July 2013, Multipolar Technology Puts $100m Into Data Center

Multipolar Technology, an information-technology company, on Monday announced plans to spend up to $100 million to build a data center in Cikarang, West Java.

Harijono Suwarno, president director at Multipolar Technology, said the company has begun the construction of the data center facility that will cover 12,000 square meters. The construction work is expected to finish by 2014.

“For the first phase, we will invest up to $20 million but to complete the work will need a further $80 million” Harijono told reporters at the Indonesia Stock Exchange (IDX) on Monday.

He said the company will use the bulk of the company’s internal cash to finance the data center. He declined to say whether the company will seek a bank loan to help finance the project.

Harijono said the company saw a bright future in the data center business in Indonesia. Government regulations say data centers or disaster recovery centers for companies that cater to public services must be located in Indonesia.

The regulation has caused some concern among foreign companies, including BlackBerry, that say it will slow their capacity to offer improved services to Indonesian customers.

Indonesia is also experiencing a rapid growth in the numbers of Internet users. Content providers, which rely on data centers, are racing to tap into the myriad growing information streams, including social media and mobile applications.

Multipolar Technology provides IT hardware, solutions and services. It has partnered with international technological companies Microsoft, Oracle, Cisco and IBM and for more than 35 years has served clients in the financial services, telecommunications, health care and government sectors.

Halim D. Mangunjodo a director for consulting enterprise delivery at Multipolar Technology, said the company intends for 60 percent of the data center capacity to go to clients in the banking sector, 20 percent to go to telecoms and the remaining 20 percent for government agencies as well as small and medium enterprises.

Halim declined to reveal the capacity of the data center.

Wellianto Halim, another director at Multipolar, said IT spending in Indonesia is predicted to grow by 46 percent in the next three years with the banking sector expected to invest heavily in e-banking services.

Multipolar Technology debuted on the IDX on Monday jumping 50 percent to Rp 720 before ending flat on Tuesday.

The company sold 20 percent of its shares in an initial public offering, generating Rp 180 billion in funds. Ciptadana Securities was the underwriter for the IPO.

Multipolar Technology is a wholly owned subsidiary of Multipolar, an investment company controlled by the Lippo Group that has been a traded company since 1986.

Muladi, president commissioner at the company, said in a statement on Monday that it intends to boost transparency and efficiency as well as the accountability of its operational activities.

Multipolar Technology and the Jakarta Globe are affiliated with Lippo Group.