Blackstone’s AirTrunk seeks US$2 bil loan for Malaysia growth — Bloomberg

(May 14): Blackstone Inc-owned data centre firm AirTrunk is marketing a US$2.3 billion (RM9.04 billion) loan to fund a Malaysia project, according to people familiar with the matter, part of a slew of tech-linked financings in Southeast Asia spurred by the artificial intelligence (AI) boom.

Proceeds will support the firm’s 200-megawatt AirTrunk JHB2 facility located in the southern state of Johor, said the people, who asked not to be identified discussing private matters. About a dozen lenders — including DBS Group Holdings Ltd, Credit Agricole SA, ING Bank NV and United Overseas Bank Ltd — are arranging the three-year loan, which is being syndicated to the broader market, the people said.

Blackstone and AirTrunk declined to comment. 

Surging demand for AI capabilities has spurred data centre operators to take on more debt to expand. Moody’s Ratings expects at least US$3 trillion to flow into the sector over the next five years, with much of it financed through debt. Some investors, however have raised concerns about whether such investments will deliver sustainable returns.

Recent deals underscore the trend. Digital Edge and power producer B.Grimm Power Pcl this month announced an US$880 million facility, the largest-ever financing for a data centre project in Thailand. Bain Capital-owned Bridge Data Centres has also been in talks with lenders for a potential loan of up to US$6 billion for expansion in the country. In Malaysia, Singapore-based DayOne Data Centers Ltd has been seeking to double the size of an existing loan to as much as US$7 billion for its expansion plans.

AirTrunk’s loan — which carries two one-year extension options — pays an interest margin of 225 basis points above the Secured Overnight Financing Rate for offshore financing and 235 basis points for onshore, the people said. The Sydney-headquartered firm is also looking to raise at least A$500 million (US$358 million or RM1.42 billion) through asset-backed bonds for its data centre expansion, among the first for the region.