HEC Acquisition of WinTriX Marks $3.9B China Data Center Deal

Landmark Transaction in China’s Digital Infrastructure

Guangdong HEC Technology announced on Wednesday its $3.9 billion acquisition of WinTriX DC Group’s China operations from Bain Capital, marking the largest data center transaction in China this year. The deal, valued at 28 billion yuan, represents a strategic pivot for HEC Technology from traditional electronics manufacturing into the rapidly expanding digital infrastructure sector.

The acquisition will be executed through a joint venture subsidiary backed by HEC Technology and its controlling shareholder, Shenzhen Dongyangguang Industry Co. The consortium includes institutional investors such as insurers and local government funds, with HEC and its parent company injecting 7.5 billion yuan to facilitate the purchase.

WinTriX: A Critical Digital Infrastructure Player

WinTriX DC Group, formerly known as Chindata Group Holdings, operates carrier-neutral hyperscale data centers across China, India, and Malaysia. The company’s strategic importance is underscored by its client base, with ByteDance accounting for 86% of WinTriX’s revenue in 2022 according to Fitch Ratings.

This customer concentration highlights both opportunity and risk. As the operator of TikTok, ByteDance’s data center requirements are massive, supporting one of the world’s most popular social media platforms. However, the heavy reliance on a single client creates potential vulnerabilities, a concern that contributed to Fitch’s credit rating actions on the company.

HEC’s Strategic Diversification Beyond Electronics

For Guangdong HEC Technology, the acquisition represents a dramatic expansion beyond its traditional business of electronic components, aluminum foil, new chemical materials, and energy materials. The Shanghai-listed company has seen its stock price surge over 99% year-to-date, positioning it well for this major diversification move.

HEC’s expertise in liquid cooling and supercapacitor technologies directly addresses WinTriX’s high-density AI computing requirements. Additionally, the company’s green energy assets are expected to reduce operational costs for the data center operator, a crucial advantage in an energy-intensive industry.

Bain Capital’s Strategic Exit Strategy

The sale culminates Bain Capital’s multi-year investment in Chinese data centers. The Boston-based private equity firm initially acquired Chindata in 2019 and merged it with Southeast Asian operator Bridge Data Centres. In August 2023, Bain privatized the combined entity in a $3.16 billion deal before rebranding it as WinTriX DC Group.

Crucially, Bain Capital will retain control of Bridge Data Centres, which operates facilities outside China and secured $2.8 billion in bank financing in March 2025 to support expansion in Southeast Asia and India. This selective exit strategy allows Bain to maintain exposure to growing markets while realizing gains from the mature Chinese operations.

China’s Explosive Data Center Market Growth

The transaction occurs amid unprecedented growth in China’s data center sector. Research firm Technavio projects the market will grow by $274.39 billion between 2025 and 2029, representing a compound annual growth rate of 38.3%. This expansion is driven by surging demand for artificial intelligence applications and cloud computing services.

China’s AI infrastructure investment is reaching historic levels, with projections suggesting the country could deploy $84 billion to $98 billion in AI capital expenditure in 2025, representing a 48% growth from 2024. Government funding is expected to dominate, with public sector contributions reaching up to $56 billion.

ByteDance’s Global Data Center Strategy

ByteDance’s reliance on WinTriX reflects the company’s broader global expansion strategy. The TikTok parent has allocated $12 billion for AI infrastructure investments in 2025, with $6.8 billion earmarked for expansion outside China. The company is actively developing data centers across multiple regions, including projects in Brazil, Thailand, and Southeast Asia.

This global approach helps ByteDance navigate regulatory challenges while ensuring robust infrastructure for its platforms. The company’s use of international data centers has also provided workarounds for accessing high-performance computing resources despite trade restrictions.

Market Implications and Future Outlook

The HEC acquisition reflects broader trends in China’s digital infrastructure landscape. As Beijing promotes its “AI+” initiative to integrate artificial intelligence across multiple sectors, demand for data center capacity continues to surge. The transaction assigns an enterprise value of approximately 36 billion yuan to WinTriX’s China business, representing a substantial premium that reflects these growth expectations.

For international investors, the deal signals both opportunities and challenges in China’s tech sector. While growth prospects remain strong, concerns about customer concentration, regulatory oversight, and trade tensions continue to influence investment decisions.

Regulatory and Competitive Landscape

The transaction is expected to finalize in the first quarter of 2026 pending regulatory approval. This timeline reflects the increasingly complex regulatory environment for large technology transactions in China, particularly those involving critical digital infrastructure.

Competition in China’s hyperscale data center market is intensifying, with major players including Alibaba, Tencent, and other technology giants expanding their own facilities. The HEC-WinTriX combination creates a significant player in this competitive landscape, particularly given the operational synergies between HEC’s technical capabilities and WinTriX’s established client relationships.