Vantage raises 720 million euros in the first ever euro ABS transaction backed by European data centres

Vantage Data Centers was the first to withdraw from the European high-tech infrastructure market. It raised 721.4 million euros (approximately $821.4 million) through data center assets-backed bond transactions. The move presents another clear indication of booming data center infrastructure, driven largely by AI ARMS racing and the growing need for computing-heavy workloads.

The transaction is a familiar model in the US market but is structured as a new asset support securitization (ABS) in the European data center. This includes four fully leased hyperscale facilities (two in Berlin and two in Frankfurt) that combine capacity of approximately 55 megawatts. The site was valued at over $1 billion earlier this year.

What’s very noteworthy about this is how the funding was set up. Vantage used the infrastructure itself and also predicted future revenues from these facilities as collateral. It’s a play that works well in the US, and now Vantage brings it to Europe.

The company pays an average coupon of 4.3% on issued bonds. This is relatively appealing given the size and structure of the transaction.

“We believe the ABS market in particular is best suited to our type of assets, which are real estate-centric, high-credit quality tenants, long-term leases and near-perfect for ABS investors.”

And the demand was strong. According to Rich Cosgray, SVP of Vantage’s Global Capital Markets, the offer was “double and 4 times overregistered for each funding.”

“We had investors who weren’t comfortable with that leverage level,” Cosgray said.

The funds will be directed to repaying the construction loans used to construct the four German facilities.

This is not Vantage’s ABS’s first dance. Last year, the company raised £600 million in a similar contract, including the UK’s Cardiff campus. Across the EMEA region, Vantage currently has approximately 2,500 megawatts of capacity live or during development.

Barclays and Deutsche Bank led the latest deals, with Clifford Chance providing lawyers.