A Chinese data center operator and developer has raised $1.6 billion in a secondary listing on the Hong Kong Stock Exchange, and considers the territory to be a hub of the region.
Shanghai-based GDS Holdings, which has been listed on Nasdaq since 2016, is the latest in a wave of companies making secondary listings in Hong Kong, according to the South China Morning Post. The secondary listing has become increasingly popular since e-commerce giant Alibaba Group did so last November.
GDS said its move was motivated by increasing trade tensions between the U.S. and China.
“It’s important for all of our shareholders that we have a secondary listing in Hong Kong, which ensures that there will be a liquid market for our shares in the long term,” said GDS Chief Financial Officer Daniel Newman, according to the Morning Post.
The pandemic has fueled demand for data center services. Data centers are key to the operations of streaming services like Netflix and the internet ecosystem as a whole. Tiktok’s parent company ByteDance has signed three large leases for data center capacity in Virginia this year.
DBS Bank in a recent report projected a 15 percent annual increase in demand for data centers in Hong Kong over the next three to five years.
GDS is China’s largest data center services provider not tied to a single telecom network or internet service provider. It had a 21.9 percent market share as of 2019. Singapore-based Technologies Telemedia owns a controlling 34 percent stake in the company. [SCMP] — Dennis Lynch