Kao Data secures up to £130m in funding to finance colocation datacentre expansions

Harlow-based colocation provider Kao Data has secured up to £130m in additional funding as it sets it sights on expanding its operations after securing a sizeable financial services client.

The company, whose datacentre campus in Essex is home to the UK’s fastest supercomputer, Cambridge-1, has signed a deal with infrastructure investment company Infratil that will result in the company holding a 40% share in Kao.

Other entities with stakes in the business include the investment arm of Legal & General, which is understood to hold a 50% share of Kao, and the Goldcare Noé Group.

“With global demand for connectivity continuing to rise, this is an excellent opportunity to expand our digital infrastructure portfolio and build on our successful datacentre platform investment in Australia and New Zealand,” said Infratil CEO Jason Boyes.

News of the deal follows the announcement that Kao has signed an agreement to acquire two further datacentre locations in the UK, with an anchor tenant already secured in the form of an unnamed financial services business. This deal is expected to grow its capacity from 40MW to 55MW.

Lee Myall, CEO of Kao Data, said the investment would pave the way for the company to pick up the pace of its efforts to provide high-performance computing (HPC) capabilities to a wider range of industries.

“This investment presents a strategic opportunity to accelerate our mission of supporting the computing requirements of advanced industries, and to do so sustainably,” he added.

Since its inception in 2014, Kao Data has moved to set itself apart from the rest of the colocation community by seeking to build a wholesale-only colocation facility, the design of which is directly inspired by how the hyperscale cloud giants build their datacentres.

To this point, the company has emerged as a vocal supporter of the Facebook-based Open Compute Project (OCP) open source initiative, with the firm opting to kit out its site with technologies created by its community. The campus was also the first in the country to be certified as OCP-ready.

This means it has been designed to the standards set out by the OCP, which are focused on encouraging operators to embrace open source hardware to improve the efficiency and scalability of their datacentres.

The company also confirmed on 25 May 2021 that its datacentres had acquired certification from Nvidia that states it has capability to support and host workloads that rely on the chipmaker’s latest graphics processing unit (GPU) technologies, including artificial intelligence and HPC workloads.

The company has made a concerted effort to court industries and clients with HPC requirements, including the life sciences and healthcare, while also championing the use of more environmentally friendly datacentre cooling techniques.