Dongguan's richest man gambles on computing power, Dongyangguang gradually acquires Qinhuai Data China

Article | Damo Finance

After being suspended for 9 trading days, Dongyangguang (600673.SH) officially announced a private placement plan, aiming to fully acquire Qinhuai Data China.

On March 6, Dongyangguang issued a notice stating that it plans to acquire a 70% stake in Yichang Dongshu No.1 Investment Co., Ltd. (hereinafter referred to as “Dongshu No.1”) through issuing shares, and to raise supporting funds by issuing shares to no more than 35 specific investors. The announcement shows that the issuance price is 19.68 yuan per share, which is 80% of the average price over the 120 trading days prior to the pricing date.

Dongyangguang plans to acquire Dongshu No.1, targeting its wholly owned computing power asset Qinhuai Data China. Qinhuai Data China was originally the China business of Qinhuai Data Group, a leading IDC (Internet Data Center) operator in the Asia-Pacific emerging markets, mainly operating data centers in China, India, and Southeast Asia.

Currently, Qinhuai Data China has deployed large-scale computing infrastructure in the Beijing-Tianjin-Hebei region, Yangtze River Delta, Pearl River Delta, and Northwest China. For Dongyangguang, fully acquiring Qinhuai Data China not only helps the company transition into the computing power business but also boosts its performance.

The announcement shows that in 2024 and 2025, Qinhuai Data China’s revenue is expected to be 6.048 billion yuan and 6.382 billion yuan, respectively, with net profits of 1.309 billion yuan and 1.655 billion yuan.

As early as September last year, Dongyangguang was involved in the acquisition of Qinhuai Data China. At that time, the company spent 3.45 billion yuan to acquire a 30% stake in Dongshu No.1, which was wholly owned by its subsidiary Dongshu No.3, and the final transaction involved acquiring 100% of Qinhuai Data China for 28 billion yuan.

However, just half a year later, Dongyangguang changed its mind, shifting from a minority shareholder to a controlling shareholder, aiming to fully control Qinhuai Data China’s computing assets.

A staff member from Dongyangguang’s Secretary Office told media that initially, the company only considered a stake acquisition, “but during the subsequent acquisition process, we gained a deeper understanding of this industry and related resources, and during the Spring Festival, we decided to plan this (controlling Dongshu No.1) matter.”

Since early 2025, Dongyangguang’s stock price has continued to soar, with a cumulative increase of 244.64%. The latest stock price is 38.91 yuan per share, with a total market value of 117.1 billion yuan. As Dongyangguang’s market cap grows, the net worth of its actual controller, Zhang Yushuai’s family, has also risen. The 2025 Hurun Rich List shows that Zhang Yushuai and his mother Guo Meilan are worth up to 40 billion yuan, officially becoming the richest in Dongguan.

Notably, due to the rapid rise in stock price, the private placement price of 19.68 yuan per share set by Dongyangguang is far below the current market price, at a 50% discount. Previously, Dongyangguang introduced investors such as Orient Asset Management, Yunfeng Fund, Fujian and Hubei Yidu State-owned Capital, and Pingtan Development, a listed company, to participate in the acquisition of Qinhuai Data China. If the transaction proceeds smoothly, these investors will become shareholders of Dongyangguang.

Two-step Approach: Shareholding then Control

Public information shows that Qinhuai Data Group was founded in 2015 by Wangsu Technology (300017.SZ), and was sold in 2019 to the well-known investment firm Bain Capital. After acquiring Qinhuai Data Group, Bain Capital carried out a series of actions including capital injections, business integration, NASDAQ listing, privatization, and business spin-offs. Ultimately, Bain Capital planned to sell its China business of Qinhuai Data.

Besides Dongyangguang, other bidders such as Runze Technology (300442.SZ), Yoozoo Games (002174.SZ), and Shanghai Electric Group also participated in the competition for Qinhuai Data, with Dongyangguang emerging as the winner.

To gain control of Qinhuai Data China, Dongyangguang adopted a two-step approach: first acquiring a stake, then gaining control. In the September last year stake transaction, Dongyangguang chose to introduce external funds to set up an SPV to facilitate the large 28 billion yuan deal.

Specifically, Dongyangguang, Dongyangguang Industrial, and subsequent investors will jointly increase capital in Dongshu No.1. Dongshu No.1 will contribute all the capital increase funds into its wholly owned subsidiary Dongchuang Future. Dongchuang Future, upon receiving the capital, will sign a merger loan agreement with a syndicate and contribute the funds into its subsidiary Dongshu No.3, which will be the final transaction entity to acquire 100% of Qinhuai Data China.

According to Dongyangguang’s latest announcement, Dongshu No.1 has completed the fundraising and now has 19 institutional shareholders. Besides Dongyangguang, investors include AMC Orient Asset Management, well-known investment firm Yunfeng Fund, state-owned funds from Fujian and Hubei Yidu, and listed company Pingtan Development.

After the stake in Qinhuai Data China is finalized, Dongyangguang will begin planning to fully control the platform.

Dongyangguang plans to acquire 68.98% of Dongshu No.1 from 16 transaction counterparties including Dongfang Yihua and Duyou Private Equity, and to purchase all assets of Tongyi No.1, Tongyi No.2, and 36 individual shareholders, thereby obtaining a 1.02% stake in Dongshu No.1. If completed, Dongyangguang will fully control Dongshu No.1 and indirectly hold 100% of Qinhuai Data China.

After the transaction, the shareholders of Dongshu No.1 will also become shareholders of Dongyangguang. Currently, the actual controller of Dongyangguang is Zhang Yushuai, who, through Shenzhen Dongyangguang Industrial and its concerted parties, controls 52.84% of the voting rights. The announcement states that this private placement will not change Dongyangguang’s control.

In addition to the private placement to acquire Qinhuai Data China, Dongyangguang will also raise supporting funds through share issuance. The announcement shows that the total amount of supporting funds raised will not exceed 100% of the transaction price, and will be used for paying intermediary fees, taxes, project construction of the target company, repaying bank loans, and supplementing working capital for both the listed company and the target. Specific uses and amounts will be disclosed in the restructuring report.

Dongyangguang’s Bold Bet on Computing Power

Behind the acquisition of Qinhuai Data China, Dongyangguang is ramping up its computing power business.

Dongyangguang Group was founded in 1997 by Zhejiang businessman Zhang Zhongneng. Initially, the company mainly engaged in aluminum foil, later branching into the pharmaceutical industry, producing oseltamivir for flu treatment. Under Zhang Zhongneng’s management, Dongyangguang Group established two listed companies: Dongyangguang and Dongyangguang Pharmaceutical. Dongyangguang’s main businesses include electronic components, high-end aluminum foil, new chemical materials, and energy materials. In 2020, Zhang Zhongneng passed away due to illness, and his son Zhang Yushuai took over.

After the second generation took over, Dongyangguang Group faced some business challenges. Dongyangguang Changjiang Pharmaceutical experienced a decline in performance due to falling sales of oseltamivir, and the company’s performance fluctuated due to sluggish consumer electronics markets and lithium battery inventory reductions.

To find new growth drivers, Dongyangguang first expanded into new energy, then made acquisitions in new chemical materials. In 2024, Dongyangguang acquired Jiangxi Chlor-Alkali Chemical Blue Hengda, completing its fluorine-chlorine industry chain layout. After consolidating Blue Hengda, Dongyangguang’s performance began to recover. In the first three quarters of 2025, the company’s revenue reached 10.97 billion yuan, up 23.56% year-on-year; net profit attributable to shareholders was 906 million yuan, up 189.80%.

Since 2025, Dongyangguang has also targeted the computing power sector. In March 2025, Dongyangguang partnered with Zhongji Xuchuang, a leading optical module company, to jointly establish a subsidiary providing liquid cooling solutions for data center heat dissipation. During the acquisition of Qinhuai Data China, Liu Sheng, chairman of Zhongji Xuchuang, also participated through Hengqin Yuan Chuang, holding a 5.22% stake in Dongshu No.1.

Now, Dongyangguang plans to fully control Qinhuai Data China. The company states that this transaction will help accelerate its transformation into a high-tech enterprise in the AI field, promote performance growth, and enhance shareholder returns.