Infratil raises $927m in share placement to fuel data centre expansion

Infrastructure investment company Infratil (ASX: IFT) has raised approximately $927 million from the underwritten share placement component of a planned $1.07 billion equity raising.

The placement saw the issue of new Infratil shares at approximately $9.41 each, representing a discount of 6.8% to the last closing price of $10.10 on 14 June and a 6% discount to the five-day volume-weighted average price (VWAP) of $10.01.

It attracted interest from existing shareholders and new investors, with total demand reported to be in excess of the placement size and eligible shareholders who bid for a pro-rata portion of new shares under the placement allocated their full bid on a ‘best efforts’ basis.

Data centre growth

Proceeds from the placement are expected to create “significant capacity” to fund growth investments by trans-Tasman developer and operator Canberra Data Centres (CDC) and across the broader Infratil portfolio.

CDC has been one of Infratil’s most lucrative investments, with its stake currently valued at approximately $409m.

This compares to the total cash consideration of $392m paid in 2016 for 48% equity.

“CDC continues to see a surge in demand for data centre capacity,” Infratil chief executive officer Jason Boyes said.

“The proceeds of this equity raising will be used to fund its accelerated growth and provide additional balance sheet flexibility to allow us to continue to invest across our portfolio.”

Infratil expects to commit around $600m to CDC over the next two years, representing its pro-rata share of the total estimated funding capacity required to execute on its medium-term development pipeline.

Retail share offer

Infratil also launched a $139m non-underwritten retail share offer of new shares this week, which is expected to further boost the capital raising.

The shares will be issued at the lowest price between the placement price or a 2.5% discount to the five-day VWAP prior to the offer being announced.

If the offer is oversubscribed, Infratil said it may scale back the applications at its discretion.

All eligible shareholders will be able to participate in the equity raising exercise via the placement or retail offer.