NEXTDC Ltd (ASX:NXT) said on Monday it will seek roughly A$2.2 billion in new capital as the company responds to rapidly rising demand for data centre capacity.
The proposed package comprises a fully underwritten A$1.5 billion pro-rata accelerated non-renounceable entitlement offer, together with an expanded A$1.7 billion hybrid securities offering, according to an exchange filing. Canadian investor La Caisse has committed an additional A$700 million to the hybrid component, bringing its total backing for that raise to A$1.7 billion.
The company reported a pro forma increase of 250 megawatts in contracted utilisation, taking that metric to 667MW as of March 31 - a 60% rise since December. At the same time, NEXTDC said its forward order book expanded by 83% to 544MW, citing strong demand from hyperscale and artificial intelligence customers.
Shares issued under the entitlement will be priced at A$12.70 each, which the company said represents an 8.6% discount to the theoretical ex-rights price.
NEXTDC indicated that the funds raised will be used to accelerate development of its S4 facility in Western Sydney. In conjunction with the capital-raising announcement, management raised capital expenditure guidance for fiscal 2026 to as much as A$3 billion.
Looking ahead, the company stated it expects contracted earnings from its existing capacity to exceed A$1 billion over time, reflecting what it described as strong long-term growth visibility.
Context and implications
- The dual-structured capital raise is intended to support rapid build-out of capacity in response to materially higher contracted utilisation and a growing forward order book.
- La Caisse's increased commitment to the hybrid securities offering constitutes a significant portion of that instrument's backing, while the entitlement offer is fully underwritten at A$1.5 billion.
- Management has signalled a substantially higher near-term investment profile with fiscal 2026 capex guidance raised to as much as A$3 billion, while projecting eventual contracted earnings above A$1 billion.
The company did not provide additional commentary beyond the filing on its timetable for the entitlement or hybrid offerings, nor did it present further detail on the phasing of S4 development within the filing.
Investors and market participants assessing NEXTDC's plans will be weighing the scale of the capital programme and the company's stated revenue outlook against execution timelines for the S4 facility and the success of the entitlement and hybrid securities offers.