Financing growth in Infratil's data centres

Company News

by Glenn Dyer

New Zealand infrastructure investor Infratil (ASX:IFT) announced on Monday that it is seeking more than NZ$1 billion to finance the rapid growth in its data centre businesses.

The investor revealed early Monday morning its plan to raise NZ$1.15 billion (approximately A$1.06 billion) to further invest in data centre operator CDC, driven by increased demand for cloud adoption and generative AI.

The fundraising consists of an underwritten placement of NZ$1 billion to major shareholders and a non-underwritten retail offer of NZ$150 million.

The placement shares will be issued at NZ$10.15 each, representing a 6.8% discount to the company's closing price of NZ$10.89 on Friday. Shares under the retail offer will be issued at a price lower than the placement price, Infratil stated.

Infratil’s primary data investment is in Trans-Tasman data centre developer and operator CDC.

Infratil CEO Jason Boyes commented on Monday that CDC has been one of the company's most successful investments, stating, "Its stake is currently independently valued at NZ$4.420 billion, approximately 10 times the initial investment made in 2016." The valuation was NZ$3.6 billion at the end of 2023.

The firm anticipates committing approximately A$600 million in equity funding to its 48.2%-owned CDC over the next two years.

Infratil competes with rivals such as NEXTDC, Air Trunk, Macquarie Technology, AWS (Amazon), Digital Switch, and Equinix, among others.

Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

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