Chinese data center operator Vnet is setting up a data center investment fund with Chinese insurance company Dajia.
The fund, which will be jointly operated by Vnet and Dajia subsidiary Dajia Investment Holding Company, will make its first investment in Vnet’s Taicang IDC campus in the Jiangsu province north of Shanghai, China.
Described as a “significant milestone for China’s data center sector” by the two companies, the fund will be a pre-REITs fund targeting hyperscale sites. Vnet will own 51 percent of the fund, with Dajia taking the other 49 percent.
The Taicang campus has capacity of 210MW, and the new fund will invest 5.74 billion Yuan ($789m) in the site.
Josh Sheng Chen, founder, executive chairperson and interim CEO of Vnet, said his company was “thrilled” to announce the news.
“It demonstrates our prowess in effectively managing capital and asset operating cycles, bolstering our capital sources with long-term investors while further enhancing our balance sheet efficiency,” he said.
“We will continue to pursue innovative financing structures and explore exits for our existing premium data centers, building a healthy, sustainable capital and asset cycle that propels our long-term growth while contributing to China's high-quality digital economy development."
Chen founded Vnet as 21Vianet in the mid-1990s. It has more than 50 data centers in 30 cities across China, totaling around 475MW.
The company is publicly listed, but Chen had been considering buying up all share capital in the business and taking it private. However, he withdrew this offer in July.
It has been quite the year for Vnet, which is also facing a potential class action lawsuit over claims of securities fraud.
Dajia Insurance is one of China’s largest insurance companies and was set up in 2019, with the backing of the Chinese government, to take over the assets of another insurance firm Anbang, which went bankrupt.
