Hyperscale data center firm Vantage Data Centers has raised $530 million in securitized notes.
The proceeds from this transaction are primarily being used to refinance the company’s Variable Funding Note (VFN) facility, which was used to facilitate the company's recent CA22, as well as to fund general corporate needs.
Vantage SDC (Stabilized Data Centers) – a joint venture with DigitalBridge formed in 2020 to hold Vantage’s ‘stabilized’ data centers – acquired Vantage’s 24MW CA22 data center in Santa Clara, California, last month for $539 million.
“This transaction marks Vantage’s seventh securitization financing since 2018 when we pioneered the use of this approach in the data center sector,” said Sharif Metwalli, Vantage’s CFO. “We are faced with increasing demand for premiere hyperscale data centers that can be delivered quickly and sustainably.”
“Our strong financial position enables us to continue our global expansion with favorable interest rates that not only reduce our overall costs but further strengthen our competitive position in the market. We appreciate DigitalBridge’s partnership throughout this process and their continued support to grow our business.”
The notes are a five-year issuance and rated A- by Standard & Poor’s. They generally rank pari-passu – i.e. equal in the event of insolvency – with Vantage’s existing outstanding notes. The transaction was supported by DigitalBridge Investment Management, the investment management arm of Vantage’s majority stakeholder, DigitalBridge Group, Inc.
“We are proud of our ability to execute unprecedented financings for our portfolio companies, and we applaud the Vantage team for this milestone,” said Marc Ganzi, president and CEO of DigitalBridge. “Not only does the transaction spread represent Vantage’s tightest yet, it is also a meaningful improvement in spread compared to the company’s October 2020 offering, which was the lowest coupon financing issued in the data center sector."
"The outsized demand for this financing is a testament to the expertise of the Vantage and DigitalBridge teams and the value-creation opportunities ahead, and we are excited to continue working together to build a best-in-class global digital infrastructure platform. We are confident that Vantage is very well positioned for long-term growth and success.”