Bain denies China Merchants acquisition of ChinData

Bain Capital has informed ChinData that it will not sell the company to China Merchants because it is pursuing its own deal to take the data center operator private. Last week the company verified in an investor disclosure that it had received a preliminary non-binding acquisition proposal letter from China Merchants Capital Holdings. However, ChinData reported receiving a letter on the same day from Bain shareholders BCPE Bridge Cayman, L.P. and BCPE Stack Holdings, L.P. stating they have no plans to sell any shares to a third party.

In June, ChinData's existing investor Bain Capital (through the two BCPE entities), submitted a non-binding proposition to acquire all outstanding ordinary shares and take the company private, whereas China Merchants filed a larger counter-bid last week. ChinData stated that its special committee was still reviewing the bids and that no decisions regarding the company's response to either proposal had been made. The Bain shareholders own approximately 42 percent of ChinData and more than 87 percent of the company's voting authority.

ChinData operates over 17 data centers in China, Malaysia, and Thailand; its non-Chinese facilities are administered by subsidiary Bridge Data Centres, which is also constructing a site in India. In 2019, Bain acquired ChinData from Wangsu Science and Technology Co. and integrated it with one of its portfolio companies, Bridge Data Centres. In 2020, the merged business went public. Bain still owns approximately 42 percent of ChinData as of 2020, when SK Holdings acquired a stake in the company.