ITC Properties Group Ltd (HKEX: 00199) has announced a significant step in its strategic advancement to combine traditional property assets with AI computing infrastructure. The company's wholly-owned subsidiary, ITC Strategic Management Limited, has entered into a Memorandum of Cooperation with China Unicom (Hong Kong) Operations Limited.
The memorandum aims to foster comprehensive collaboration in AI computing infrastructure and related business sectors within the Hong Kong region. The partnership will focus on two primary areas of cooperation.
Initial Focus Areas
The first area involves collaboration on existing client business. China Unicom (Hong Kong) will provide ITC's subsidiary with access to its own or partnered IDC resources in Hong Kong for use by ITC's customers, provided these resources meet specific technical and operational requirements. The pricing for these resources is to be competitively advantageous, not exceeding prices offered directly by resource holders to similar internet clients, with minimized management fees in a back-to-back cooperation model to offer ITC favorable costs.
China Unicom (Hong Kong) has committed to supplying no less than 2MW of IDC resources within three months, followed by an additional 4MW within six to nine months. ITC's subsidiary will sign a letter of intent and proceed to a formal leasing agreement once conditions are confirmed. A joint team will be formed to develop technical and service solutions and engage in client communications, with China Unicom (Hong Kong) providing operational support guarantees.
Market Expansion Initiatives
The second area is joint market development in Hong Kong. For new IDC facilities built by ITC's subsidiary, China Unicom (Hong Kong) will jointly promote them as cooperative resources, sign a non-binding leasing intent letter, and may outsource renovation and system integration services to ITC. China Unicom will also ensure its backbone network connects to these facilities.
Regarding a new IDC facility being developed by China Unicom (Hong Kong) in Fanling, Hong Kong, the telecom operator will share business plans and construction schedules. ITC's subsidiary intends to secure approximately 8 to 10MW of IDC resources for subleasing to its own clients, taking responsibility for renovation, integration, operation, and client service from a white-floor delivery point.
Furthermore, China Unicom (Hong Kong) will authorize ITC's subsidiary to sell its products and services, providing technical support, training, and competitive distribution pricing. Both parties will establish a close cooperation mechanism with a dedicated task force for regular coordination.
Strategic Context
This move follows the group's strategic investment in NScale Global Holdings Limited and a previous memorandum of understanding with Beijing Qiyuan Zhisuan Data Technology Co., Ltd., as part of its ongoing pursuit of strategic opportunities in AI infrastructure and data center industries.
Management Perspective
The board believes the rapid development of AI and the digital economy is driving strong demand for high-quality, reliable IDC and computing resources. As a leading telecommunications operator in Hong Kong, China Unicom (Hong Kong) possesses superior network infrastructure, extensive IDC resources, and mature operational capabilities.
Expected Benefits
The board views this strategic partnership as enabling the group to swiftly access stable and cost-competitive Hong Kong IDC resources to meet growing client demand for AI computing power. It is also expected to enhance the quality and reliability of the group's computing infrastructure services by leveraging China Unicom's network advantages. The collaboration aims to achieve resource complementarity and client sharing to jointly expand the AI computing services market in Hong Kong and the Greater Bay Area, thereby further strengthening the group's position and competitiveness within the AI infrastructure value chain.
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