Brookfield hit it big with towers. Here's what it has in mind next.

In the US, Brookfield has invested $15 billion in a joint venture with Intel Corp. to build a semiconductor fabrication facility in Arizona, US. While Brookfield's plan to invest in semiconductors in India is still nascent, it would likely happen in a similar manner, said Arpit Agrawal, head of India and Middle East for Brookfield Infrastructure Partners, which has assets worth over $13 billion in India.

“Can we do that in India? For sure. There is a lot of impetus behind semiconductors; this is an area we can potentially look at," Agrawal said.

India has been seeking foreign investments in chipmaking, and has committed over ₹84,000 crore in production-linked incentives. Earlier this month, Maharashtra said the Adani group is working on a $10 billion semiconductor project with Israel’s Tower Semiconductor. On Monday, Mint reported that Tata Electronics intends to set up two more semiconductor fabs in Gujarat. In 2023, multiple media reports reported Reliance Industries' intent to enter chip fabs, including through a potential investment in Tower Semiconductor.

While Brookfield has engaged in some discussions with Indian companies, these plans and conversations are still at a very nascent stage, and will require more thought and structuring, Agrawal said, declining to specify a timeline or a quantum for the investment, as there was no certainty a deal would happen. Brookfield has no minimum or maximum cap for investment for projects it is really interested in, Agrawal clarified.

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A Brookfield spokesperson later said that talks to invest in other segments, such as fibres and smart meters, were at a more advanced stage, and its plan for semiconductors was still a thesis. The firm is also evaluating opportunities in developing infrastructure for EVs.

"We've evaluated many different elements, including charging infrastructure and decarbonization of public transport," Agrawal said. "What we are looking for is also the scale. So, I'm leaving aside manufacturing."

The firm is currently looking to invest in the EV value chain. "We hope to be a big player in the sector in the near term," he said.

Given its tower business, investing in the fibre business would be an adjacency for Brookfield. “I think it makes sense for us to participate in it. We have about one and a half million kilometres of fibre globally. In India, we don't have a fibre investment. Is it a sector we like? Of course -- about 100,000 km of fibre are being built monthly in the country. It is something we have looked at elsewhere in the world. It is for us to find the right business model that works," Agrawal said.

Reliance Jio’s Digital Fibre Infrastructure Trust has received investments from investors such as the Abu Dhabi Investment Authority and the Public Investment Fund of Saudi Arabia.

Partnering corporates is a key pillar of Brookfield's strategy, Agrawal said. “A large portion of infrastructure still resides with corporates. Leaving aside a specific situation of semiconductor, just generally, if you think about it, a large amount of infrastructure lies with corporates where they may think about recycling those assets because it's not necessarily the best use of that capital, and we are there to support them with that," he said.

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Brookfield’s Data Infrastructure Trust, along with British Columbia Investment Management Corp. and Singapore’s GIC, last week completed the acquisition of ATC's Indian assets in a $2 billion transaction, making it the largest owner of telecom towers in India. This is Brookfield’s third acquisition in this space after it acquired the tower business from Reliance Industries four years ago. In 2022, Brookfield also acquired 6,300 towers focused on small cell sites.

With this latest acquisition, the firm will own more than 257,000 towers in India, with the ability to expand further.

"Telecom towers is one business that we like. It's a sector we like. So, if that means whether we need to we grow organically or inorganically, it's definitely on the cards," said Agrawal. "We are sold on the story."

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In January this year, Brookfield announced a three-way joint venture with Reliance and US-based real estate investment trust Digital Realty to develop data centres in India.

Agrawal noted that Brookfield, which is currently developing two data centres in Mumbai and Chennai through this JV, could potentially act as a consolidator in the data centre segment at a later date.