US Private Capital Groups have invested billions of dollars in data centers that serve Tictok owner, in agreement by Frenzy, who has now threatened with US approach to Chinese companies on the best chips.
Blackstone, Bain Capital, Warburg Pincus and General Atlantic supported companies that manage Malaysian data centers that believe that the Bytedenca based in Beijing as a tenant, according to four people with knowledge of arrangements.
Some did so without knowing if Residence benefits or plans to use websites to exploit the legal holes to access top NVIDIA chips as it develops its potential of artificial intelligence.
Chinese companies are forbidden to buy chips with the highest performance of NVIDIA outside the US since 2023. But they could legally provide access to them, renting space in data centers abroad, often in Malaysia, containing chips owned by third parties.
In May, the hole will be closed by rules that forbids Chinese groups not only own such advanced American technology, but also approaches to it to help build a large linguistic models that are transferred to China.
The rules were issued by Joe Biden’s administration just before she left her duty.
“If you want to build a data center in Malaysia with Nvidia[chips]. . . You will need to meet these types of security requirements that include not allowing [China] Training of large language models on these data sets, “said Alan Estevez, then an American podetar of the industry and security trade, he told the Financial Times just before he left the role last month.
The type of chips used in data centers is not clear, and private capital groups do not always know, partly because the Data Center companies do not own chips or rent to clients.
However, more people who know about the matter have told the FT that Bytottance plans to use data centers in Malaysia to access top Nvidia chips.
The redemption groups tend to consider “providing the building of the electricity and the coolant; the server and what is on the server is not your job,” said the CEO of Private Capital.
In recent years, Bytottance has been using data centers outside China, especially in Malaysia, as it becomes a key player in the Chinese AI race. Plans large orders to build its foreign AI capacity this year, including such rental contracts, FT reported last month. Separately, General Atlantic invested in the Bytedtanca itself.
“There was this game of cats and mouse where it is [US] The trade department has changed the parameters to shoot chips, “said Matt Rabinowitz, a partner at Pillsbury’s law firm.
According to the new rules, the identity of both the owner and the chip operator used in data centers will have to go through the examination process to ensure compliance.
It is not clear whether US President Donald Trump, who in the first term, will increase the measures against China, further change the regulations that regulate the export of chip and their use.
The rules that would enter into force in May could reach the value of investment in the purchase groups, reducing demand for data centers if bytottentenance and other Chinese groups are unable to use them to secure access to the best NVIDIA chips, said the counselor in which the industry works.
However, high demand for data centers at globally can fill in the gap, they added.
Global groups of private capital have accelerated investments in data centers in recent years, even when other activities that have slowed down have slowed down, attracted to the prospect of being exposed to growing internet and AI boom.
They tried to distance themselves from the complex and politically full of business supply of chip, supporting companies that manage physical buildings of data centers but do not own chips inside.
“We have no visibility or impact on the servers and equipment our customers install in data centers,” said Princeton Digital Group, an operator of the data center supported by Warburg Pincus.
Bain said that his portfolio companies do not have access to servers within the data centers they manage, and added that “in accordance with relevant laws and regulations in all the jurisdictions we manage.” Blackstone and General Atlantic refused to comment.
Bytetance is a resident of the anchor at the Data Center in Johor, a state in southern Malaysia, owned by the Bain Capital Portfolio Company Wintrix unit. He is also a tenant in several other facilities in Johor, including those led by Airtrunk, PDG and Epoch Digital owned by Blackstone, and managed by General Atlantic Infrastructure Manager ACTIS.
Bytottance plans to spend more than $ 12 billion on AI infrastructure this year, and $ 6.8 billion is intended for investing outside China. But US rules could complicate that investment.
“Bytottance is in accordance with all applicable laws and regulations,” FT said.
Warburg Pincus agreed to invest up to $ 300 million in PDG in 2017 and has since injected further funds. Blackstone completed $ 24 billion ($ 15 billion) Procurement of Airtrunk based in Sydneywhich has places in Malaysia, Singapore, Hong Kong, Australia and Japan, December.
Bain bought a Chinese Chandate in 2019, combined with the bridge data centers and listed a combined company at Nasdaq in 2020. Combined company, now known as Wintrix, private worth $ 3 billion in 2023.
General Atlantic ended up buying Actis last year.
