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SHANGHAI - GDS Holdings Limited (NASDAQ:GDS; HKEX:9698), a data center operator in China with a market capitalization of $59.63 million and strong financial health according to InvestingPro analysis, announced today that its China REIT (C-REIT) initial public offering on the Shanghai Stock Exchange has been priced at RMB 3.00 per unit.
The C-REIT offering was 166 times oversubscribed during institutional bookbuilding. The REIT will issue 800 million units, raising gross proceeds of RMB 2,400 million. The strong investor interest aligns with GDS’s solid fundamentals, including a healthy current ratio of 3.56 and annual revenue of $96.84 million.
Based on projected figures for 2026 included in the offering memorandum, the pricing implies an EV/EBITDA multiple of 16.9 times and a dividend yield of 5.2 percent.
As part of the transaction, GDS will sell a 100% equity interest in a project company holding stabilized data center assets to the C-REIT for an enterprise value of approximately RMB 2,319 million. The company will receive net cash proceeds of approximately RMB 2,111 million from the sale.
GDS plans to reinvest RMB 480 million to subscribe for 20% of the C-REIT units issued in the IPO. The company will continue to operate and manage the underlying data center assets under a services agreement, generating recurring annual fee income of approximately RMB 5 million.
The transaction will also allow GDS to de-consolidate approximately RMB 62 million of net debt and other liabilities, according to the press release statement. With an EBITDA of $9.2 million and current undervalued status based on InvestingPro’s Fair Value analysis, the company appears well-positioned for future growth. Discover more detailed financial insights and 8 additional ProTips by subscribing to InvestingPro.
In other recent news, GDS Holdings Limited has received approval from Chinese regulators to launch a real estate investment trust (REIT) initial public offering on the Shanghai Stock Exchange. This REIT will acquire stabilized data center assets from GDS, with the company retaining a 20% stake and offering the remaining 80% to outside investors. The data center assets are appraised at approximately RMB 1,933 million, and the transaction is expected to close soon, subject to certain conditions. Additionally, GDS Holdings has launched a $450 million private offering of convertible senior notes, maturing in 2032, with an option to increase by $50 million based on market conditions. The proceeds from this offering are intended for working capital and refinancing existing debts, including convertible bonds due in 2029. Furthermore, GDS Holdings has initiated a public offering of 5.2 million American Depositary Shares (ADSs), with an additional option for underwriters to purchase up to 780,000 ADSs. The ADS offering proceeds are allocated for general corporate purposes and debt refinancing. These strategic financial initiatives are part of GDS Holdings’ efforts to enhance its position in China’s high-performance data center market.
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