GDS to Sell $587 Million Stake in Asia Data Centers to Investors

GDS Holdings Ltd. agreed to sell a stake in its data-center business outside of China to a group of alternative asset managers that includes Hillhouse Investmentand Boyu Capital for $587 million.

Hillhouse, Rava Partners, Boyu, Princeville Capital, Tekne Capital and other firms will own 44% of the operation, while GDS will hold the remaining 56%, GDS said in a statement Tuesday confirming a March 11 report by Bloomberg News.

The transaction will allow the business, GDS International, to obtain its own financing for expansion. The asset managers will purchase Series A convertible preferred shares newly issued by GDS International, ...