Vantage Data Centers has successfully issued its first bonds in the Asia-Pacific (APAC) region through its wholly-owned subsidiary, PowerDC Holdco Pte. This landmark financial move showcases Vantage’s innovative approach to funding and highlights the growing importance of the APAC market in the data center industry.
Details of the Bond Issuance
Key Financial Highlights
The bond offerings consist of:
- SGD$100 million (US$74 million): A five-year bond listed on the Singapore Exchange.
- HKD$300 million (US$38.5 million): A three-year bond also listed on the Singapore Exchange.
Strategic Backing
The bonds are guaranteed by the Credit Guarantee & Investment Facility (CGIF), a trust fund of the Asian Development Bank. This backing enhances their credibility and appeal to investors across the region. ING served as the sole global coordinator and joint lead manager, overseeing the issuance process in both Singapore and Hong Kong.
Purpose of the Bonds
Proceeds from the bond issuance will be directed towards refinancing PowerDC’s outstanding debt. By reducing existing liabilities, Vantage aims to strengthen its financial stability and support its ongoing expansion in the APAC market.
A Milestone Achievement
Joel Cheah, Chief Financial Officer (APAC) for Vantage Data Centers, described the issuance as a groundbreaking achievement. “The bond issuances represent a first-of-its-kind on many fronts. This is only made possible due to the team’s relentless pursuit of innovative and trailblazing financing strategies, which enables Vantage to diversify its funding sources and extend our APAC investor base to debt capital investors,” said Cheah.
He added, “We are delighted with the strong investor interest shown in our APAC business; the oversubscription and success of this bond issuance is a clear endorsement of our financial standing, creditworthiness, and business strategy.”
Vantage’s Journey in the APAC Market
Entry into the Region
Vantage Data Centers entered the APAC market in 2021 through DigitalBridge’s acquisition of PCCW’s data center business. This acquisition merged PCCW and AgileDC into Vantage, setting the stage for rapid growth.
Expanding Portfolio
The company’s APAC portfolio now includes 452MW of operational and planned IT capacity across five key markets:
- Australia
- Hong Kong
- Taiwan
- Japan
- Malaysia
Recent Developments
Earlier this year, Vantage broke ground on a significant 256MW data center campus in Cyberjaya, Malaysia. This project reflects the company’s commitment to addressing the rising demand for hyperscale data center solutions in the region.
Industry Implications
Importance of APAC for Data Centers
The APAC region has emerged as a critical market for data centers due to its rapid digitalization, expanding internet usage, and growing demand for cloud and edge computing services. Vantage’s bond issuance highlights the increasing sophistication and maturity of financial strategies in the industry.
Diversified Funding Strategies
By issuing bonds guaranteed by CGIF, Vantage demonstrates a proactive approach to diversifying funding sources. This strategy not only mitigates risks but also broadens the company’s investor base, ensuring long-term financial sustainability.
FAQ: Understanding Vantage’s Bond Issuance
What is the purpose of Vantage’s bond issuance?
The bonds are being used to refinance PowerDC’s outstanding debt, enhancing Vantage’s financial stability and supporting its growth in the APAC market.
Why are the bonds listed on the Singapore Exchange?
The Singapore Exchange is a leading platform for financial instruments in Asia, offering visibility and credibility to international investors.
What makes these bonds unique?
These bonds are the first of their kind for Vantage in the APAC region, backed by CGIF and reflecting innovative financing strategies.
What role does CGIF play in the bond issuance?
CGIF guarantees the bonds, providing assurance to investors and enhancing the bonds’ attractiveness.
How does this issuance align with Vantage’s business strategy?
The issuance supports Vantage’s strategy of financial diversification and regional expansion, underscoring its commitment to innovation and growth.
