Chinese operator GDS is reportedly looking to sell a stake in its international operations.

GDS Nusajaya Tech Park johor malaysia.jpg
GDS campus in Malaysia – GDS

Citing people familiar with the situation, Bloomberg reports that alternative asset managers Hillhouse Capital, Boyu Capital, and CDH Investments are in advanced talks to invest in GDS Holdings Ltd’s data center business outside China.

An agreement on a total investment of $500 million to $600 million may be reached in the coming weeks. Other investors could also be involved in a deal, they said.

Representatives for Hillhouse, a long-term investor in GDS, didn’t respond to Bloomberg’s request for comment, while Boyu, CDH, and GDS were also contacted for comment but did not reply.

GDS, founded in 2006, operates dozens of data centers across Shanghai, Beijing, Shenzhen, Guangzhou, Chengdu, and Hong Kong. The company is also developing facilities in Malaysia at YTL's new campus as well as the Nusajaya Tech Park, both located in the Johor region. It is also developing a campus in Batam, Indonesia, and Singapore.

GDS has been trading in New York since 2016 when it raised about $200 million in an initial public offering. It was listed in Hong Kong in 2020, with GDS raising around HK$14.9 billion ($1.9 billion).

STT GDC is a major investor in the company.

As well as GDS, Hillhouse has invested in's infrastructure asset management unit.

Established in 2002, CDH Investments is an alternative investment fund manager focused on China. Specializing in private equity, venture capital, and credit, the firm has more than $21 billion of assets under management. In 2022, it raised RMB 2 billion ($310 million) for a domestic data center fund. It was previously interested in acquiring Chinese operator Vnet.

Founded in 2010, Boyu Capital is a Chinese private equity firm. Its investments include Alibaba.