News Alert: Received takeover interests from rivals
- News reported that Chindata received takeover interests from rivals, including GDS
- Discussions are still at preliminary stage with no transaction valuation details
- Chindata’s board hasn’t considered any proposal yet
- Recent takeover interest towards Chindata and VNET implies an undemanding valuation for the sector
What’s New
– News reported that Chindata (CD US) has received preliminary takeover interest from other firms in the industry, including GDS (9698 HK) and EdgeConneX.
– Discussions are preliminary with no transaction valuation details, there is no formal sale process and the talks may not proceed to a more advanced stage.
– Chindata’s board hasn’t yet considered any proposal.
Our View:
– The takeover interest towards Chindata and acquisition proposal previously received by VNET (VNET US) implies an undemanding valuation for the sector.
– Chindata is currently trading at c.5x FY22 EV/adj EBITDA, much below its historical average of 18x-20x. Current market cap for Chindata is US$1.6bn.
– GDS and VNET are trading at c.14x and c.5x FY22 EV/adj EBITDA respectively.
– We currently rate BUY on the counter; TP of US$10.8.