(Bloomberg) – Talks to combine the activities of GDS Holdings Ltd. with GLP Pte’s data centers in China are at a standstill due to the assessment, according to people familiar with the matter.

A stock drop of nearly 60% in the past 12 months has made it difficult for Shanghai-based GDS to fund a deal in cash and stocks, the people said, asking not to be identified as the information is private. Talks could still resume later, the people said.

Representatives for GDS and GLP did not immediately respond to calls and emails seeking comment.

GDS, a U.S. and Hong Kong-listed developer and operator of data centers across China, had had preliminary discussions with GLP over a potential transaction in which the Singapore-based investment manager would become a shareholder of GDS , Bloomberg News reported in May. . The assets could have been valued at between $ 8 billion and $ 10 billion, people familiar with the matter said at the time.

Digital infrastructure assets such as data centers have become hot assets during the pandemic as platforms supporting everything from video streaming to online games have grown in popularity. This has sparked growing interest from financial investors and industry players looking to gain scale through consolidation.

GDS, which raised $ 1.7 billion on a secondary listing in Hong Kong in 2020, said at the time that it planned to use the proceeds to invest in data centers in the Asian financial hub, in China and Southeast Asia, notably through mergers and acquisitions. The company acquired hubs across China as well as land in Indonesia to build two new facilities to strengthen its market share even as rising electricity costs weighed on profits, she said. in November.

Founded in 2009, GLP is a global investment manager in logistics, digital infrastructure and related technologies, according to its website. It is present in 17 countries and has approximately $ 120 billion in assets under management.