Bain to privatize ChinData in a $3.16 billion transaction

ChinData, a Chinese data center operator, will be taken private by existing investor Bain Capital. ChinData Group Holdings Limited revealed over the weekend that it had gone into a $3.16 billion merger deal with two Bain subsidiaries that will be taken private: BCPE Chivalry Bidco Limited and BCPE Chivalry Merger Sub Limited.

It is anticipated that the merger will conclude during the fourth quarter of 2023 or the first quarter of 2024, subject to customary closing conditions. The transaction will be financed by cash contributions from the sponsors or their affiliates, debt financing from Shanghai Pudong Development Bank (DB) Co., Ltd. Lujiazui Sub-Branch and Industrial Bank Co., Ltd. Shanghai Branch, and equity transfer.

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 combined company went public. Bain still owns approximately 42 percent of ChinData as of 2020, when SK Holdings acquired a stake in the company.

In June, ChinData's existing investor Bain Capital (through the two BCPE companies), made a non-binding offer to acquire all outstanding ordinary shares and turn the company private. China Merchants, a state-owned holding company, then submitted a higher counteroffer, which Bain refused to consider. The new agreement represents an increase over Bain's initial offer but is less than China Merchant's proposal of $3.4 billion.

Last year, local operator GDS and EQT-backed EdgeConneX were rumored to be considering acquisition offers for ChinData.