Equinix Inc. (NASDAQ:EQIX), a global real estate investment trust, announced the issuance of €1.15 billion in senior notes on Friday. The offering comprises €650 million of 3.250% senior notes due 2031 and €500 million of 3.625% senior notes due 2034, both guaranteed by Equinix.
The notes were offered under an underwriting agreement dated November 13, 2024, and are part of an effort to finance or refinance green projects. Until the full allocation of the net proceeds, they may be used for general corporate purposes, including repayment of existing borrowings.
The 2031 notes carry an annual interest rate of 3.250% and mature on March 15, 2031, with interest payments commencing on March 15, 2025. The 2034 notes have an annual interest rate of 3.625% and are set to mature on November 22, 2034, with interest payments starting on November 22, 2025.
Equinix retains the right to redeem the notes before maturity, with redemption prices including a make-whole premium until a specified date close to the notes' maturity, after which no make-whole premium will apply.
In case of a change of control triggering event, Equinix must offer to repurchase the notes at 101% of the principal amount, plus accrued interest.
The notes rank equally with the issuer's other unsecured and unsubordinated debt and are structurally subordinated to the liabilities of Equinix's subsidiaries. The guarantees by Equinix rank equally with its other unsecured and unsubordinated debt but are effectively subordinated to its secured indebtedness.
The indentures include restrictive covenants on liens, asset sales, mergers, consolidations, and sale-leaseback transactions, with certain exceptions. An event of default may lead to the acceleration of the debt's maturity.
In other recent news, Equinix Inc. posted robust growth in its third-quarter earnings call, marking the 87th consecutive quarter of revenue growth. The company reported a 7% year-over-year increase in revenue to $2.2 billion and a 12% rise in adjusted EBITDA. Equinix's interconnection revenues also saw a significant increase, growing by 10%.
In addition, Equinix announced a joint venture with CPP Investment Board and GIC, planning to invest over $15 billion in xScale facilities. This strategic move is designed to meet the rising demand for digital infrastructure and AI workloads.
Analysts noted the company's strong performance across all regions and a 60% increase in net megawatts sold quarter-over-quarter. The firm also opened new data centers in Johannesburg and expanded in New York and Tokyo. Equinix expects robust performance in Q4 and aims for long-term growth rates of 8% to 10%, reflecting the company's positive outlook.
InvestingPro Insights
Equinix's recent €1.15 billion senior notes issuance aligns with its strategic financial management and commitment to green projects. This move is reflected in the company's solid financial position, as evidenced by InvestingPro data. Equinix boasts a substantial market capitalization of $90.35 billion, underlining its significant presence in the data center REIT sector.
The company's revenue growth of 4.5% over the last twelve months, coupled with a 6.03% quarterly revenue growth, suggests a steady expansion trajectory. This growth pattern supports Equinix's ability to take on new debt for green initiatives and general corporate purposes.
InvestingPro Tips highlight Equinix's strong dividend performance, with a 24.93% dividend growth rate over the last twelve months. This robust dividend growth, combined with the current dividend yield of 1.84%, may appeal to income-focused investors and reflects the company's financial health and shareholder-friendly policies.
For readers interested in a deeper analysis, InvestingPro offers 16 additional tips for Equinix, providing a comprehensive view of the company's financial landscape and future prospects.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.