The interconnection and data center company Equinix made two announcements on Feb. 28 about a public offering of senior notes. The company plans to sell up to U.S.$1.5 billion in senior notes with the intention to use the net proceeds to redeem its outstanding 8.125% senior notes due in 2018 pursuant to the optional redemption provisions of such notes and for general corporate purposes. This may include capital expenditures, distributions to Equinix’s stockholders in connection with its proposed conversion to a real estate investment trust (REIT), working capital, potential acquisitions and strategic transactions.
In the morning, the company announced that it intended to offer U.S.$1 billion aggregate principal amount of its senior notes due in 2020 and senior notes due in 2023 under an automatically effective shelf registration statement on file with the Securities and Exchange Commission (SEC).
Later in the evening, Equinix announced the pricing of the senior notes, stating that there was an increase in the combined aggregate principal amount from the U.S.$1 billion offering previously announced.
Equinix’s net proceeds from this offering will be approximately $1.48 billion after deducting underwriting discounts and estimated offering expenses payable by it.
In a statement, the company said that the interest will be payable semi-annually at a rate of 4.875% per year for the 2020 notes and 5.375% per year for the 2023 notes. The 2020 notes will mature on April 1, 2020 and the 2023 notes will mature on April 1, 2023. The notes are redeemable by Equinix prior to maturity at a premium under certain circumstances.
As noted by Data Center Knowledge, Equinix made some aggressive acquisitions last year, boosting its global expansion with three deals, including the acquisition of Frankfurt data hub AncoTel, Shanghai provider AsiaTone and a data center in Dubai.
