New Financing Raises Total Asset-Backed Securities to $1.81 Billion
TierPoint, a leading, national enterprise data center company and provider of secure, connected IT platform solutions that power digital transformation initiatives, announced the completion of a new $500 million asset-backed securities issuance to support the company’s continued growth and development.
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Through a wholly owned subsidiary, across the current and two prior transactions (in 2023 and 2024), the company has now issued a total of $1.81 billion in asset-backed securities (ABS) on a portfolio of 33 data centers, including two data centers (one in Dallas and one in St. Louis) newly added to that portfolio. Like prior transactions, the new term notes were issued under the company’s Green Finance Framework, demonstrating TierPoint’s ongoing commitment to operating in accordance with environmental and sustainability principles.
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The new offering further enhances the company’s investment grade credit profile (of which over 90% is rated A-), extends its debt maturities, lowers its long term cost of capital, increases liquidity, and allows the company to deploy more data center capacity to meet accelerating demand in current and new markets.
All the notes were rated investment grade by Kroll Bond Rating Agency and have a 30-year legal maturity, including:
- $240 million of Class A notes rated A- with a 7-year anticipated repayment date
- $245 million of Class A notes rated A- with a 4-year anticipated repayment date
- $15 million of Class B notes rated BBB- with a 4-year anticipated repayment date.
In addition, the variable funding notes (VFN) have been extended two years to 2030 and the interest rate reduced.
Net proceeds after transaction fees and expenses will be used to refinance $300 million of $360 million previously issued term notes, repay in full the balance outstanding under the VFN, and for working capital.
“TierPoint is experiencing exceptional growth, with robust demand for our IT infrastructure solutions, including our market-leading enterprise and high-density colocation services that are required for artificial intelligence and other compute-intensive, GPU-accelerated workloads,” said TierPoint Chairman and CEO Jerry Kent. “This new financing positions us to answer client demand, continue growing and providing the cutting-edge service, support, highly available and reliable operations for which we are known.”
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TierPoint’s Green Finance Framework and the three green ABS issuances demonstrate a world-class commitment to aligning business growth and sustainability with transparency. The framework aligns to the core components of the International Capital Market Association (ICMA) Green Bond Principles, as well as the Green Loan Principles. These principles are voluntary guidelines to ensure consistency and transparency across the Green Bond and Green Loan markets globally, including requirements for the issuer to allocate an amount equal to the green ABS proceeds to support the financing or refinancing of Eligible Green Assets with clear and positive environmental impact. Full details of the Green Finance Framework, as well as an external review by Sustainalytics, are available on TierPoint’s website.
Guggenheim Securities, LLC acted as sole structuring advisor and lead bookrunner for the securitized notes. Deutsche Bank Securities, Inc., TD Securities (USA) LLC, Barclays Capital, Inc., and ING Financial Markets LLC also acted as active bookrunners for the term notes. Jeffries LLC and J.P. Morgan Securities LLC acted as passive bookrunners. Simpson Thacher & Bartlett LLP served as counsel to TierPoint and Latham & Watkins LLP as counsel to Guggenheim.
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Source – Businesswire
