VNET Group announced the introduction of a strategic investor associated with CATL. Upon completion of the transaction, the new shareholder will hold approximately 38.1% of the company's shares. According to an announcement released by VNET Group on May 13, the buyers, PJ Millennium I Limited and PJ Millennium II Limited, will acquire a maximum aggregate of approximately 650.4 million Class A ordinary shares from entities under Shandong Hi-Speed Holdings Group Co., Ltd. The purchase price is set at $1.4486 per share (equivalent to $8.6914 per ADS). Both buyers are wholly-owned subsidiaries of PJ Millennium Limited Partnership. The general partner of this partnership, Lochpine BG I GP Limited, is associated with CATL and is considered a non-controlling, non-consolidated affiliate of the battery giant. Following the transaction's completion, the new strategic investor will deepen cooperation with VNET Group in technology and supply chain areas. The parties will also sign an investor rights agreement and a voting and joint agreement to maintain stability in the company's control. Josh Sheng Chen, Founder, Executive Chairman, and Interim CEO of VNET Group, stated that the company will collaborate with its strategic partner to drive end-to-end innovation in the next-generation AI data center industry. Buoyed by this news, VNET Group's stock price rose sharply on the day, gaining over 24%.
Transaction Structure: Buyer is CATL-affiliated Capital, Seller is Shandong Hi-Speed Holdings Group The sellers in this share transfer are Success Flow International Investment Limited and Choice Faith Group Holdings Limited, both under Shandong Hi-Speed Holdings Group Co., Ltd. The buyer (CATL-affiliated capital) will acquire up to 650,424,192 Class A ordinary shares for a total cash consideration of $1.4486 per share. Based on VNET Group's 1,708,149,858 issued ordinary shares as of March 31, 2026, the buyer's aggregate shareholding post-transaction will reach approximately 38.1%. The transaction includes certain flexible arrangements: According to the share purchase agreement, seller Choice Faith may dispose of up to 195,127,260 Class A ordinary shares before closing. However, this arrangement does not apply if the buyer requests the closing for all such shares on or before September 15, 2026. The overall transaction is expected to close in the fourth quarter of 2026, subject to the fulfillment of conditions precedent, including approval from Shandong Hi-Speed Holdings' shareholders' meeting.
Agreement Arrangements: Signing of Voting and Joint Agreement to Maintain Control Stability Alongside the execution of the share purchase agreement, the buyer and VNET Group simultaneously signed an investor rights agreement. The buyer also signed a voting and joint agreement with company founder Josh Sheng Chen and his affiliated investment entities. Both agreements will become effective upon completion of the closing. Under the investor rights agreement, VNET Group will grant the buyer certain investor rights, while the buyer must agree to restrictions on the transfer or disposal of its held shares for a specified period. The buyer also commits to taking necessary actions to support the stability of the company's control. Regarding voting arrangements, the buyer commits that for a specified period, it will vote the Class A ordinary shares acquired in this transaction at the company's shareholders' meetings in accordance with the voting instructions of the founder's side. This arrangement means that despite the new strategic investor holding a stake close to 40%, the actual controlling authority of the company will remain with the founder's side represented by Josh Sheng Chen.
Strategic Intent: Industrial Synergy in the AI Data Center Arena VNET Group is a leading carrier-neutral and cloud-neutral internet data center service provider in China. It operates data centers in over 30 cities nationwide, serving more than 7,000 enterprise clients, including internet companies, government agencies, blue-chip enterprises, and small-to-medium businesses. In the announcement, Josh Sheng Chen stated that the company will deepen cooperation with the new strategic investor in technology and supply chain fields and jointly advance original end-to-end innovation in the next-generation AI data center industry. The investment by the CATL-affiliated party is widely interpreted as indicating potential collaboration between the two in key AI data center supply chain segments such as energy storage and power infrastructure. As a global leader in power and energy storage battery manufacturing, the entry of CATL-affiliated capital into a leading Chinese data center operator reflects the overall trend of industrial capital accelerating its deployment in the AI infrastructure sector. For VNET Group, introducing a strategic investor with an industrial background is also expected to enhance its resource acquisition capabilities and market competitiveness during the AI data center construction cycle.
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