VNET Announces Authorization of Share Repurchase Program Up to US$50 Million

Rhea-AI Summary

VNET Group (Nasdaq: VNET), a leading Chinese internet data center services provider, has announced a significant share repurchase program of up to US$50 million in American depositary shares (ADSs). The program, reflecting management's confidence in the company's future growth, will be executed over a 12-month period through various means including open market purchases and privately negotiated transactions.

The repurchase program will be funded using existing resources and can be modified, suspended, or terminated at management's discretion. Each ADS represents six Class A ordinary shares, and repurchased shares may be held as treasury shares or cancelled.

Positive

• Board authorization for substantial US$50 million share repurchase program
• Management's demonstrated confidence in company's future growth prospects
• Flexibility in repurchase execution methods including open market and private transactions
• Program funded through existing resources, indicating strong cash position

Negative

• Program implementation dependent on signing agreement with qualified broker-dealer(s)
• No guarantee of specific number of shares to be repurchased
• Program may be modified, suspended, or terminated at any time

Insights

Financial Analyst

VNET's $50M share repurchase program signals management confidence and could enhance shareholder value through reduced share count.

VNET has announced a $50 million share repurchase authorization, representing a significant capital allocation decision that could benefit shareholders in several ways. This program authorizes the company to repurchase its American depositary shares (ADSs) over a 12-month period through various methods including open market purchases, private transactions, or block trades.

Share repurchase programs typically serve multiple strategic purposes. First, they can be interpreted as a signal that management believes the company's shares are undervalued at current market prices. Second, by reducing the number of outstanding shares, repurchases can increase earnings per share (EPS) mathematically, even without operational improvements. Third, the buying activity itself may provide price support for the stock.

The announcement includes important details about implementation flexibility. Management can adjust the program's terms and size or even suspend it entirely based on market conditions and other factors. This provides VNET with the ability to optimize timing and execution. The company has specified it will use existing funds to finance the repurchases, indicating sufficient cash reserves without the need for additional financing.

While share repurchases generally reflect confidence, they also represent a specific capital allocation choice. By directing $50 million toward share repurchases, VNET is implicitly prioritizing this use of capital over alternatives such as debt reduction, increased operational investments, or acquisitions. For investors, this signals management's current view of the optimal use of company resources given their internal assessment of business conditions and opportunities.

BEIJING, June 27, 2025 /PRNewswire/ -- VNET Group, Inc. ("VNET" or the "Company") (Nasdaq: VNET), a leading carrier- and cloud-neutral internet data center services provider in China, today announced that to underscore its confidence in VNET's future development and growth prospects, its Board of Directors has authorized a share repurchase program under which VNET may repurchase up to US$50 million of its American depositary shares ("ADSs"), each representing six Class A ordinary shares of the Company, subject to the relevant rules under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the Company's insider trading policy.

The Company's share repurchases, if any, under the share repurchase program may be made from time to time on the open market at prevailing market prices, in open-market transactions, privately negotiated transactions or block trades, and/or through other legally permissible means, depending on market conditions and in accordance with the applicable rules and regulations. The timing and conditions of the share repurchases will be subject to various factors including the requirements under Rule 10b-18 and Rule 10b5-1 of the Exchange Act. The Company's Board of Directors will review the share repurchase program periodically and may authorize adjustments to its terms and size or suspend or discontinue the program. The Company expects to utilize its existing funds to fund repurchases made under this program.

The share repurchase program is effective upon and from the date on which a formal stock repurchase plan engagement agreement is signed with a qualified broker-dealer, or broker-dealers, and terminates over a 12-month period depending upon market and economic conditions, and other factors including price, trading volume, general market conditions, legal and regulatory requirements, and capital availability. The share repurchase program does not obligate VNET to acquire any particular number of American depositary shares, and the share repurchase program may be modified, suspended or terminated at any time at the management's discretion. Any repurchased ADSs may be classified and held in the name of the Company as treasury shares or ADSs, which may be cancelled or used for other purposes.

About VNET

VNET Group, Inc. is a leading carrier- and cloud-neutral internet data center services provider in China. VNET provides hosting and related services, including IDC services, cloud services, and business VPN services to improve the reliability, security, and speed of its customers' internet infrastructure. Customers may locate their servers and equipment in VNET's data centers and connect to China's internet backbone. VNET operates in more than 30 cities throughout China, servicing a diversified and loyal base of over 7,000 hosting and related enterprise customers that span numerous industries ranging from internet companies to government entities and blue-chip enterprises to small- to mid-sized enterprises.

Safe Harbor Statement

This announcement contains forward-looking statements. These forward-looking statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "target," "believes," "estimates" and similar statements. Among other things, quotations from management in this announcement as well as VNET's strategic and operational plans, including the plan to sign a definitive agreement on a pre-REITs project, contain forward-looking statements. VNET may also make written or oral forward-looking statements in its reports filed with, or furnished to, the U.S. Securities and Exchange Commission, in its annual reports to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about VNET's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: VNET's goals and strategies; VNET's liquidity conditions; VNET's expansion plans; the expected growth of the data center services market; expectations regarding demand for, and market acceptance of, VNET's services; VNET's expectations regarding keeping and strengthening its relationships with customers; VNET's plans to invest in research and development to enhance its solution and service offerings; and general economic and business conditions in the regions where VNET provides solutions and services. Further information regarding these and other risks is included in VNET's reports filed with, or furnished to, the U.S. Securities and Exchange Commission. All information provided in this press release is as of the date of this press release, and VNET undertakes no duty to update such information, except as required under applicable law.

Investor Relations Contact:

Xinyuan Liu
Tel: +86-10-8456 2121
Email: ir@vnet.com 

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SOURCE VNET Group, Inc.

FAQ

What is the size of VNET's new share repurchase program?

VNET has authorized a share repurchase program of up to US$50 million of its American depositary shares (ADSs).

How long will VNET's share buyback program last?

The program will run for a 12-month period after signing a formal stock repurchase plan engagement agreement with qualified broker-dealer(s).

How many shares are represented in each VNET ADS?

Each VNET American depositary share (ADS) represents six Class A ordinary shares of the Company.

How will VNET fund the share repurchase program?

VNET plans to utilize its existing funds to finance the share repurchase program.

What methods will VNET use to execute the share buyback?

VNET may execute the buyback through open market purchases, privately negotiated transactions, block trades, and other legally permissible means, depending on market conditions.