Securitization funding to fuel development of AI data centers
eStruxture Data Centers has secured nearly US$1 billion in asset-backed financing.
The company this week announced CA$1.35bn (US$967.9m) in financing to fund the development of AI-ready data centers across Canada.
The financing includes the first rated, Canadian asset-only data center securitization, raising a total of C$750m (US$542.8m) from its inaugural issuance. The ABS notes were issued under the company’s Green Finance Framework, introduced earlier this month.
The company didn’t outline which data center assets were included in the ABS.
In addition to its Green ABS financing, eStruxture also announced a DevCo Revolving Credit Facility, providing up to CA$600m (US$434m) of bank financing. The facility is structured with a CA$300m (US$217m) underwritten component and an accordion for an additional CA$300m available as needed.
“This groundbreaking financing marks a watershed moment for eStruxture and the Canadian digital infrastructure sector as access to strategic, low-cost capital becomes imperative to building digital infrastructure at scale,” said Todd Coleman, founder, president, and CEO of eStruxture.
“Today we forged a key step in establishing a sovereign AI ecosystem in Canada, with the capital markets signalling strong confidence in eStruxture, our leading customer base, and our growth plans.”
Guggenheim Securities acted as Lead Structuring Advisor, Scotiabank acted as Joint Structuring Advisor and Joint Active Bookrunning Manager, and National Bank acted as Passive Bookrunner for the securitized notes. The DevCo Credit Facility is being underwritten by Scotiabank and National Bank Financial.
“This first-of-its-kind rated, exclusively Canadian data center ABS represents a true financing milestone in supporting eStruxture’s strategic growth, and we are proud to partner with Todd and team to create this program,” said Matt Bissonette, senior managing director of Guggenheim Securities. “The transaction also demonstrates the successful evolution of data center securitization, enabling the sector’s continued global build-out of critical digital infrastructure.”
eStruxture was launched in 2017 with capital from Canadian pension fund Caisse de dépôt et placement du Québec (CDPQ). It claims to be the largest Canadian-owned and operated data center platform, operating around 16 data centers across Toronto, Calgary, Montreal, and Vancouver with a total footprint of 760,000 sq ft (~70,600 sqm) and 130MW of power.
Fengate Asset Management acquired the company last year for CA$1.8 billion (US1.3bn) from CDPQ.
ABS is a type of financial investment that is collateralized by an underlying pool of assets – in this case, data centers.
News that eStruxture had secured ABS financing surfaced earlier this week. Other companies to secure funds backed by their data centers include EdgeCore, TierPoint, Cloud Capital, Switch, DataBank, and Vantage.
“This two-part financing completely transforms our balance sheet and optimizes our capital structure to expand our position as the leading hyperscale and AI data center provider in Canada,” added Taylor Hammond, head of corporate development and capital markets at eStruxture.
