Bank of China contributes to a €2.645 billion EUR sustainability-linked syndicated loan to EdgeConneX to refinance its European Data Center (DC) Portfolio

Bank of China contributes to a €2.645 billion EUR sustainability-linked syndicated loan to EdgeConneX to refinance its European Data Center (DC) Portfolio In October 2022, financial close was reached on a deal in which a syndicate of 27 banks — including the Bank of China (BOC) — entered into a €2.645 billion EUR sustainability-linked syndicated loan agreement with EdgeConneX, Inc. — a Delaware-incorporated American edge-network data center developer, owner, and operator headquartered in Herndon, Virginia wholly-owned by Swedish global investment firm EQT Infrastructure IV — to refinance its European Data Center (DC) Portfolio.

The loan was divided four tranches: a €1.57 billion EUR term loan tranche, a €750 million EUR multi-currency capex facility, a €250 million EUR multi-currency capex facility, and a €75 million EUR revolving credit facility (RCF). The loan carried a maturity period of seven years.

The term loan tranche carried an interest rate based on a variable rate plus a margin beginning at 210 basis points (bps) stepping up over time to 305 bps.

Based on the portfolio's performance on certain environmental, social, and governance (ESG)-linked Key Performance Indicators related to the weighted-average power usage effectiveness of the portfolio, the level of renewable electricity purchased compared with the overall level of electricity used, and the ratio of operational data centers with zero-waste-to-landfill certification, the margin would be adjusted up or down by 5 bps, and a commitment fee of 35% of the margin (approximately 74 bps) and upfront fee of 150 bps.

The proceeds were to be used by the borrower to refinance existing project-level debt of about €1.3 billion EUR from across its European data center portfolio encompassing 12 operational sites across seven jurisdictions in Europe (including data centers in Dublin, Ireland; Amsterdam, the Netherlands; Brussels, Belgium; Munich, Germany; Barcelona, Spain; and Warsaw, Poland), 90% of which was contracted on a long-term basis with blue-chip tenants and to up-size debt to allow for capex facilities to support future developments, such as greenfield construction and permitted acquisitions and joint ventures.

In addition to BOC, the following lenders contributed to the loan syndicate: ABN AMRO Bank N.V., ING Group N.V., Natixis, Société Générale SA (SocGen), Sumitomo Mitsui Banking Corporation (SMBC), Benjamin de Rothschild Infrastructure Debt Generation (BRIDGE), Infranity, Assicurazioni Generali S.p.A..

IST3 Investment Foundation, Feronia SICAV-RAI, National Australia Bank Limited (NAB), NIBC Bank N.V., BNP Paribas Asset Management (BNPP AM), Crédit Agricole Corporate and Investment Bank (CACIB), Sun Life Financial, Bank SinoPac, The Canada Life Assurance Company, Mizuho Bank, Ltd., Shinhan Bank, Banco Bilbao Vizcaya Argentaria, SA (BBVA), Kookmin Bank, National Westminster Bank Plc (NatWest), Crédit Industriel et Commercial (CIC), Siemens Bank GmbH, KfW IPEX Bank GmbH, and Standard Chartered Bank plc.

ABN AMRO Bank, ING, Natixis, SocGen, and SMBC served as underwriters, with the others joining in syndication. The loan was up-sized to €2.4 billion EUR in syndication due to oversubscription