US private -equity groups have invested billions of dollars in data centers that serve the Tikok owner of bytedance, in a deal -make -rush, which is now threatened by the United States’ approach to access to Chinese companies to the best chips .
Blackstone, Bain Capital, Warburg Pincus and General Atlantic have supported companies that lead Malaysian data centers that count the Bytedance in Beijing as a tenant, according to four people with knowledge of the agreements.
Some did this without knowing whether Bytedance Has used or plans the websites to use a legal gap to access high-end nvidia chips while developing its potential artificial intelligence potential.
In Chinese companies, the purchase of Nvidia’s highest chips outside the United States has been banned since 2023. However, they were able to legally guarantee access to them by containing overseas in data centers, often in Malaysia, which contain chips that belong to third -party companies. .
The gap is to be closed in May by not only forbidding Chinese groups from the possession of such advanced US technology, but also building access to them to build up AI major language models that are returned to China.
The rules were published by Joe Biden’s administration shortly before the office.
“If you want to create a data center in Malaysia with Nvidia (chips). . . You have to meet this type of security requirements, including not the (China) training of major language models for these data records “shortly before he left the role last month.
The type of chips used in the data centers is unclear, and the private equity groups do not always know that the company companies do not have the chips or rent to customers.
However, several people with knowledge of the matter have informed the FT that bytedance the use of data centers in Malaysia to access high-end nvidia chips.
Buyout groups tend to see that “they offer a building with electricity and cooling system. The server and what is on the server is not your business, ”said a private equity manager.
In recent years, Bytedance has increasingly used the use of data centers outside of China, especially in Malaysia, because it becomes an important player in the China’s AI race. It is planning large orders to set up its overseas AI capacity this year, also through such rental agreements, the FT registered last month. Regardless of this, General Atlantic has invested in Bytedance himself.
“There was this cat and mouse game in which the (US) trade department changed the parameters to capture the chips,” said Matt Rabinowitz, partner of the Pillsbury law firm.
According to the new rules, the identity must go through a review process for both the owner and the operator of the chips used in data centers to ensure compliance with compliance.
It is not clear whether the US President Donald Trump, who strengthened measures against China in his first term, will continue to change the regulations for chip exports and their use.
The rules that should become effective in May.
They added a high demand for data centers worldwide worldwide.
Global private equity groups have driven in recent years to invest in data centers, even if other deals of activities have slowed down, which dealt with the view of the increase in growing internet use and the AI boom.
You tried to distance yourself from the complex and politically stressed business of Chip Supply by supporting companies that operate the physical buildings of the data centers but do not have the chips inside.
“We have no visibility or influence on the servers and devices that our customers install in the data centers,” said Princeton Digital Group, a data center operator supported by Warburg Pincus.
Bain said his portfolio companies had no access to the servers in the data centers they operated and added that they “correspond to the relevant laws and regulations in all jurisdiction we have”. Blackstone and General Atlantic rejected a statement.
Bytedance is the anchor tenant of a data center in Joor, a state in South -Malaysia, which belongs to a unity of the Bain Capital Portfolio Company Wintrix. It is also a tenant in several other institutions in Joor, including that of Blackstone in the possession of Airtrunk, PDG and Epoch digitally, led by General Atlantic Infrastructure Manager Actis.
Bytance plans to issue more than $ 12 billion for the AI infrastructure this year, with 6.8 billion USD being intended for investments outside China. But the US rules could make this investment more difficult.
“Bytedance corresponds to all applicable laws and regulations,” said the FT.
Warburg Pincus agreed to invest up to $ 300 million in PDG in 2017 and has injected other funds since then. Blackstone has completed a 24 billion USD ($ 15 billion). Acquisition of Airtrunk in Sydneythat have locations in Malaysia, Singapore, Hong Kong, Australia and Japan in December.
Bain bought China Chindata in 2019, merged it with Bridge calculation centers and listed the combined company for Nasdaq in 2020. The combined company, which is now known as a WinTrix, privately for an evaluation of USD 3 billion in 2023.
General Atlantic completed the purchase of Actis last year.
