Breaking news: The "landlord" of ByteDance is sold for a staggering 28 billion yuan, the most expensive deal in the industry's history.

Recently, the data center sector has been bustling with activity, and the largest merger and acquisition case to date has taken place. Chindata Group, a super giant specializing in data centers (IDC), has been sold at a high price.

It's worth mentioning that its biggest customer is ByteDance, and it serves as the "landlord" of ByteDance's data centers.

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In this transaction, the Dongyangguang Group, together with the listed company Dongyangguang and local state - owned assets, spent 28 billion yuan in cash to acquire 100% of the equity of Chindata Group's China operations from Bain Capital.

The acquirer is Yichang Dongshu No.3 Investment Co., Ltd., which was jointly established under the leadership of the Dongyangguang Group and local capital such as Yidu State - owned Assets Investment Corporation.

As for the Dongyangguang Group, its core business covers fields such as electronic new materials and biomedicine. It has been deeply involved in Yichang for 24 years, with a cumulative investment of 24 billion yuan, and has relatively deep technological barriers in liquid - cooling materials and supercapacitors.

Its fluorinated coolant technology can directly meet the heat - dissipation requirements of high - density AI computing power scenarios. For example, a data center is like a huge computer room, and computers need heat dissipation.

At this point, the reason for the merger and acquisition becomes gradually clear: the resources of both sides are complementary.

In the production bases in Ulanqab, Inner Mongolia and Yichang, Hubei, Dongyangguang has the ability to supply clean energy, and the electricity price cost in these two places is 30% lower than that in the eastern regions. Chindata Group has mature data center clusters in core economic circles such as the Beijing - Tianjin - Hebei region and the Yangtze River Delta. The two sides plan to jointly build a computing power layout of "three cores in the south, middle, and north", which can form an integrated computing power network running through the north and the south.

Zhang Yushuai, the chairman of the Dongyangguang Group, clearly stated: "This is a crucial step in actively integrating into the country's 'Eastern Data and Western Computing' strategy, and it will build a digital ecological closed - loop of green electricity - hardware - computing power - AI."

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Chindata Group was founded in 2015 and is a neutral third - party computing infrastructure operator.

Its core business includes full - life - cycle services such as server hosting, energy transmission, and IT operation and maintenance. It operates three ultra - large - scale data center clusters in the Beijing - Tianjin - Hebei region, the Yangtze River Delta, and the Guangdong - Hong Kong - Macao Greater Bay Area in China. At the same time, it has laid out the Southeast Asian market through its overseas brand Bridge Data Centres.

The founder of Chindata Group is Ju Jing, who graduated from Beihang University. He pioneered the "front - shop, back - factory" model, where customers are located in core cities such as Beijing, Shanghai, Guangzhou, and Shenzhen, and data centers are placed in cost - effective areas such as the areas around Beijing and the Yangtze River Delta.

As of the second quarter of 2024, the total IT capacity of Chindata Group in operation and under construction has reached 1640MW, and the proportion of ultra - large - scale business is as high as 99%.

The so - called ultra - large - scale business refers to data centers with extremely large scales that can meet the needs of large - volume data processing. For example, large projects for large Internet companies to store and calculate data, and there are few small and scattered businesses.

Its most core customer is ByteDance. In 2022, the revenue from ByteDance accounted for as high as 86.3%.

This ultra - large - customer model enabled Chindata Group to go public in just five years (in 2020).

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The development trajectory of Chindata Group reflects the capital - intensive nature of the IDC industry: it requires a lot of capital investment.

In the early days of its establishment in 2015, it received an investment of 1 billion yuan from Wangsu Science & Technology. In 2019, Bain Capital made a strategic investment of 570 million US dollars to take control, setting the largest single - financing record in the industry at that time. In July of the same year, it merged with Bridge Data Centres to form a group. In September 2020, it listed on the NASDAQ at a price of 13.5 US dollars per ADS, with a market value of over 5 billion US dollars on the listing day.

In August 2023, Bain Capital took it private and delisted it for 22.8 billion yuan. Two years later, it sold its China operations for 28 billion yuan.

Its business itself is also capital - intensive.

In 2018, Chindata Group invested 6 billion yuan to build the Huailai Guanting Lake New Media Big Data Industrial Base. The base finally formed a layout of "four points in the same city" with four data centers, accounting for more than 90% of the server rack - up volume in the local area.

In 2022, it launched the Taihang Mountain Base in Lingqiu, Shanxi, with a planned capacity of over 500MW, becoming the largest single - scale data center park in Asia.

According to the "Analysis Report on China's Computing Power Center Service Providers (2024)" by the China Academy of Information and Communications Technology, the top five enterprises are as follows:

Global Switch ranks first, leading the industry in three indicators including overall scale; Chindata Group ranks second;

21Vianet ranks third, operating more than 50 data centers; Data Center Group ranks fourth, providing services for Alibaba and other companies; Runze Technology ranks fifth, focusing on ultra - large - scale computing power center clusters.

Chindata Group's differential advantages are reflected in three aspects:

Firstly, it has an ultra - large - scale cluster layout, with the average capacity of a single - building data center exceeding 30MW, 2.5 times the industry average;

Secondly, it has green operation capabilities, with an average PUE (Power Usage Effectiveness) stably between 1.21 - 1.22 for three consecutive years, significantly lower than the global average of 1.57 for ultra - large - scale data centers;

Thirdly, it is deeply involved in the "four - party trading mechanism" of green electricity in Zhangjiakou. As of 2023, it has cumulatively consumed 440.2 million kWh of green electricity, reducing carbon emissions by 415,000 tons of carbon dioxide equivalent.

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The development of the Chinese IDC industry has gone through four stages:

Embryonic stage (2000 - 2009): Data centers were mainly small - scale hosting, with a market scale of less than 10 billion yuan, and the service targets were mainly financial and telecommunications enterprises.

Scaled - up development stage (2010 - 2017): The explosion of the mobile Internet gave rise to the demand for computing power, and the industry's average annual growth rate reached 27%. Professional IDC enterprises such as Chindata Group emerged.

Intensive expansion stage (2018 - 2021): Cloud - computing giants promoted the construction of ultra - large - scale data centers, and the industry's compound annual growth rate was between 26% - 28%. Chindata Group completed the layout of its cluster around the capital during this period.

Intelligent computing transformation stage (2022 - present): The large AI models drive an exponential growth in computing power demand, and the industry has entered a new stage of AIDC (Intelligent Computing Power Center). Technologies such as liquid cooling and green electricity have become core competitiveness.

The current IDC industry is undergoing profound technological changes. On the demand side, generative AI has pushed the power of a single cabinet from the traditional 10kW to over 30kW, and the kilocalorie - level GPU clusters of enterprises such as ByteDance have put forward extreme requirements for heat dissipation.

In terms of solutions, liquid - cooling technology has changed from being "optional" to "standard". The cold - plate liquid - cooling solution of the Dongyangguang Group has a relatively low transformation cost, and the pre - installed plate - type liquid - cooling module data center deployed by Chindata Group in Malaysia has achieved stable operation with a capacity of about 100MW.

Technological innovation shows three major directions: Heterogeneous computing is replacing general - purpose computing, and the "CPU + GPU + DPU" architecture has become the mainstream; Computing power resource pooling technology has increased resource utilization from 30% to 80%; The number of edge data centers is expected to grow rapidly in 2025, supporting low - latency scenarios such as autonomous driving.

These changes are driving the industry to transform from simple infrastructure leasing to comprehensive services of "computing power + algorithms + energy".

Looking forward, the IDC industry will show three major trends:

Firstly, the goal of carbon neutrality is forcing green transformation. The Yichang Zero - Carbon Computing Power Center planned by Dongyangguang and Chindata Group will reduce the PUE to below 1.05 through the integration of green electricity;

Secondly, the "Eastern Data and Western Computing" policy is promoting the coordination of the computing power network. As a western hub node, Chindata Group's Qingyang Base has undertaken some back - end processing tasks from the eastern regions;

Thirdly, the deep integration of AI and IDC. The Dongyangguang Group plans to combine its embodied intelligent robot business with Chindata Group's computing power facilities to develop customized intelligent computing solutions.

The industry predicts that with the explosion of AI computing power demand, the market scale of China's IDC will maintain an average annual growth rate of over 25% from 2023 to 2028, and the proportion of intelligent computing power will increase from 38% in 2024 to 65% in 2028.

This article does not constitute any investment advice.

This article is from the WeChat official account “Pencil News” (ID: pencilnews). The author is Pencil News, and it is published by 36Kr with authorization.