SINGAPORE (BLOOMBERG) - GDS Holdings is considering acquiring GLP's data centre business as the Chinese cloud computing company seeks to expand its digital infrastructure capacity in the world's second-largest economy, according to people familiar with the matter.

GDS, a developer and operator of high-performance data centre across China, is holding preliminary talks with the Singapore-based logistics real estate developer and fund manager over a potential transaction that could value the assets at US$8 billion to US$10 billion (S$10.7 billion-S$13.35 billion), the people said. As part of the deal GLP would become a shareholder in Shanghai-based GDS, the people said.

Considerations are at an early stage and the companies could decide against pursuing a transaction, the people said. Details including valuation and structure of a deal could change, they said.

Representatives for GDS and GLP didn't respond to phone calls, emails and text messages requesting comment.

GDS raised US$1.9 billion in a Hong Kong secondary listing last year, according to data compiled by Bloomberg, joining a cohort of US-traded Chinese firms seeking to expand their investor bases. Chief executive officer William Huang said in a November Bloomberg Television interview that the company plans to use the proceeds primarily to invest in data centres in China, Hong Kong and possibly South-east Asia. GDS might also look at M&A opportunities in China and beyond, Mr Huang said.

GLP has been developing GLP Huailai Internet Data Centre in Hebei province, northern China, with a total investment of about 10 billion yuan (S$2.1 billion), according to its website. The facility will offer more than 15,000 cabinets, which can hold about 200,000 servers, once the project is finished.

GLP, formerly known as Global Logistics Properties, delisted from the Singapore Exchange in January 2018 after a $16 billion buyout, then Asia's largest.