Blackstone Tactical Opportunities (NYSE: BX), one of the world’s largest alternative investment firms, will purchase $250 million of convertible notes of VNET Group (Nasdaq: VNET), a carrier- and cloud-neutral Internet data center services provider in China. The Notes have a five-year term and pay interest at a rate of 2% per year.
“Over the last two years, we have accelerated the growth of our data center footprint in high-demand locations across China’s tier-1 cities,” said Josh Chen, Founder and Executive Chairman of VNET, formerly known as 21Vianet Group. “Blackstone’s investment provides us with the capital to take advantage of a robust pipeline of attractive development projects that support our hyperscale and enterprise customers. We look forward to building on this partnership with Blackstone.”
The deal is subject to customary closing conditions and is scheduled to close in early February.
Data Centers China
VNET offers hosting and associated services, such as data center services, cloud services, and corporate VPN services, in order to increase the stability, security, and speed of its clients’ Internet infrastructure.
VNET operates in over 30 data center locations across China, serving a diverse base of over 6,000 hosting and associated enterprise clients across a wide range of industries, from Internet corporations to government bodies, blue-chip enterprises to small- to mid-sized businesses.
“Under the leadership of Josh and the management team, VNET has become one of the top data center operators in China with a strong operating track record,” said Jasvinder Khaira, a Senior Managing Director in the Tactical Opportunities Group of Blackstone. “Data centers and the ongoing migration to the cloud are two of Blackstone’s highest conviction themes globally and we believe VNET plays an important role in the buildout of China’s digital new infrastructure.”
Blackstone’s $881 billion in assets under management include global investments in private equity, real estate, public debt and equity, infrastructure, life sciences, growth equity, opportunistic, non-investment grade credit, real assets, and secondary funds.