Actis commits $180m to China data center business

Numerous private equity investors are focusing on data center development in China, with Bain Capital and GIC Private among those to embark on buy-and-build plans in the country recently. These investments exist at the nexus of private equity and infrastructure in that they present a layer of technological complexity – and a need for PE-style growth equity and value creation – while offering traditional long-term, yield-driven income streams.

Indeed, Actis is investing under its Asia real estate strategy, which was established last year through the acquisition of Standard Chartered’s principal finance real estate business in the region. The team, then with Standard Chartered, first backed Chayora in 2016, taking a majority stake in the company.

Chayora will use the new funding - plus $250 million in project debt - to develop two facilities in Tianjin and acquire additional land to support expansion in Tianjin and Shanghai. The Tianjin campuses offer 300 megawatts of grid computing power supply, with a goal of delivering over 50% from sustainable sources. They are carrier-neutral and claim to offer world-class fiber connectivity.

“Data volumes continue to grow in exponential terms and in China, as the world’s largest online market, the levels of technical innovation in artificial intelligence, machine learning and related applications in responding to end-user demands, means being in China offers huge potential to global sector leaders,” said Oliver Jones, CEO of Chayora, in a statement.

Earlier this year, Bain acquired a majority stake in the data center division of Shenzhen-listed NetScience Technology for RMB990 million ($147 million). The asset – known as ChinaData – was then combined with Southeast Asia and India-focused Bridge Data Centers to create a region-wide data center solution. Meanwhile, GIC entered the space through a partnership with specialist developer GDS Holdings.

Warburg Pincus established a data center joint venture with China-focused 21Vianet in 2016. It subsequently invested in Princeton Digital Group, which recently acquired facilities in China, Indonesia, and Singapore. Other pan-Asian players include TPG Capital and Goldman Sachs-backed AirTrunk.

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• Topics
• Greater China
• Expansion
• Infrastructure
• Technology
• China
• Actis Capital
• Growth capital