NextDC to raise $1b in century bonds with La Caisse commitment
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The news: Data centre developer NextDC has launched a $1 billion wholesale offer of subordinated hybrid securities to support its growth strategy following a commitment from Canadian investment group La Caisse to apply for the full offer.
The numbers: The hybrid securities have a non-call period of five years and a maturity of 100 years.
The debt has an initial coupon rate of 7.5% for the first five years. It then steps up to 9.2% until year 10 before a further 5% step up. A one-off special coupon such that total yield for years one to five is 9.2% per annum is payable if the securities are not redeemed at the end of year five.
NextDC’s pro-forma liquidity as at 31 December 2025, when including the hybrid securities offer, is $5.2 billion.
The context: The hybrid securities offer is being made to “a group of institutional investors” and will close on 23 April 2026. La Caisse’s final allocation will be determined after the offer concludes and may be less than the offer.
Barrenjoey is the sole structuring adviser, lead manager and offer agent to NextDC.
The debt sits outside NextDC’s senior debt covenants and are “deeply subordinated instruments, ranking junior to all existing and future debt obligations of the Group”. It is only senior to equity and has no equity conversion features.
NextDC may defer coupons if it chooses, subject to conditions.
Three of NextDC’s proposed data centre projects are being supported by the New South Wales government’s Investment Delivery Authority to hasten the approvals process.
The source: ASX
