Infratil plans monster $1.15b capital raise for data centre growth

Infratil plans to raise $1.15 billion to fund further investment in data centres. Photo / NZME

Infrastructure investor Infratil plans to raise $1.150 billion to fund its next stage of growth and to further fund investment in data centre company CDC’s expansion.

The capital raise will be one of the biggest the New Zealand market has seen in recent years.

The company said the new funds would aid further investment in CDC’s accelerating growth and would provide more flexibility for growth across Infratil’s global portfolio.

CDC's Hobsonville 1 data centre in northwest Auckland. Photo / Chris Keall

The equity raising comprises an underwritten $1b placement of new Infratil shares and a $150 million non-underwritten retail offer of new Ishares, with the ability to accept over-subscriptions at its discretion.

Infratil chief executive Jason Boyes said transtasman data centre developer and operator CDC had been one of the company’s most successful investments, with its stake independently valued at $4.42b, about 10 times what was first invested in 2016.

“CDC continues to see a surge in demand for data centre capacity,” he said.

Infratil owns about 48.24 per cent of CDC. The Future Fund and Commonwealth Superannuation Fund own 25 per cent each.

Proceeds of the equity raising will be used to fund its accelerated growth, and provide additional balance-sheet flexibility to let Infratil continue to invest across its portfolio.

“Demand continues to accelerate on the back of cloud adoption and significant investments in generative AI,” Boyes said.

The underwritten placement will be conducted through a bookbuild in which eligible investors in New Zealand, Australia, and other jurisdictions will be invited to participate.

A trading halt has been granted by NZX and ASX to facilitate the placement.

The placement will have 98.5 million new ordinary shares, about 11.8 per cent of current issue, to raise about $1b at $10.15 each — a 6.8 per cent discount to the company’s last traded price on Friday.

The retail offer aims to raise $150m with the ability to scale applications or accept over-subscriptions at Infratil’s complete discretion.

Headquartered in Canberra, Australia, CDC is the largest privately owned and operated data centre business across Australia and New Zealand.

The company operates 268 megawatts of capacity across 13 facilities in four campus locations.

A further 265MW of capacity is under construction across Auckland, Melbourne, Sydney and Canberra.

The proceeds of the equity raising, combined with cash on hand and currently available and undrawn debt facilities, will provide Infratil with about $1.8b of total available liquidity.

Following the equity raising, wholly-owned group gearing will fall from 20 per cent to 11.8 per cent.

Infratil confirmed there was no change to its full year 2025 earnings guidance, which was for earnings before interest, tax, depreciation, amortisation and financial instruments (ebitdaf) of $980m to $1.03b.

At the mid-point, this would be an 11 per cent improvement on a strong 2024 result.

Australia’s Barrenjoey Markets, Goldman Sachs, and UBS New Zealand Limited are acting as joint lead managers for the issue.

Jamie Gray is an Auckland-based journalist, covering the financial markets and the primary sector. He joined the Herald in 2011.