NEXTDC completes $120m capital raising
- 17 December, 2015 09:02
Datacentre builder, NEXTDC, has announced the successful completion of the retail component of the Entitlement Offer launched in late November, under which eligible retail shareholders were able to apply for additional new shares, and raised approximately $30 million.
The previously completed institutional component of the Entitlement Offer was oversubscribed and raised about $40 million, while the institutional placement raised $50 million from existing and new investors.
The company announced in late November that it was seeking to raise a further $120 million that will go towards building two new facilities for Brisbane and Melbourne.
Current facilities in Brisbane (B1) and Melbourne (M1) are reaching capacity constraints with B1 contract utilisation reaching 90 per cent as of October 31 and Melbourne reaching 77 per cent.
Before embarking on the new investments, NEXTDC said at the the time that it was seeking $120 million in capital raising consisting of a placement and entitlement offer.
The placement will raise $50 million at $2.55 per share, which is the equivalent to its closing price on November 20, and a 13.3 per cent premium to the offer price of $2.25 per new share under the entitlement offer, which comprises a 1 for 6.23 accelerated non-renounceable pro rata entitlement offer to raise $70 million.
Recently NEXTDC’s Notes II offer successfully closed, raising $100 million.
The capital raising and Notes II offer along with current cash reserves, undrawn secured debt facility and ongoing operating cash flow will provide NEXTDC with adequate funds to complete the initial investment in the new facilities and fund capital requirements of potential new large customer opportunities.
The new B2 facility is expected to have an initial capacity of 1MW+ with a target total capacity of about 6MW. M2 will have 2MW+ and a total capacity target of 25 MW.
NEXTDC expects to invest between $175 million to $200 million in the next 12 to 18 months and is currently undertaking due diligence on a number of new sites for each of the facilities, expecting to commission both in the second half of FY17.
“Both B1 and M1 have proven to be highly successful facilities for the company in a relatively short period of time,” NEXTDC CEO, Craig Scroggie, said. “We are confident that the ongoing demand in these geographies, together with our return expectations warrants this next phase of investment in markets we know well.”
The company stated its trading performance for the first four months of FY16 have been inline with expectations and looks to achieve its FY16 revenue guidance of $85 million to $90 million, and EBITDA guidance of $25 million to $28 million.