US data center firm TierPoint has secured another $500 million in financing.
The company this week announced the completion of a new $500m asset-backed securities issuance to support the company’s continued growth and development. The financing will allow the company to deploy more data center capacity to meet increased demand in current and new markets.
Through a wholly owned subsidiary, TierPoint has now issued a total of $1.81 billion in asset-backed securities (ABS) on a portfolio of 33 data centers. It made two prior transactions in 2023 and 2024.
The latest financing adds two further data centers in Dallas, Texas, and St. Louis, Missouri, to that portfolio.
As with prior transactions, the new term notes were issued under the company’s Green Finance Framework.
The investment grade notes have a 30-year legal maturity, including $240m of Class A notes rated A- with a 7-year anticipated repayment date; $245m of Class A notes rated A- with a 4-year anticipated repayment date; $15m of Class B notes rated BBB- with a 4-year anticipated repayment date. In addition, the variable funding notes (VFN) have been extended two years to 2030, and the interest rate has been reduced.
Net proceeds after transaction fees and expenses will be used to refinance $300m of $360m previously issued term notes, repay in full the balance outstanding under the VFN, and for working capital.
“TierPoint is experiencing exceptional growth, with robust demand for our IT infrastructure solutions, including our market-leading enterprise and high-density colocation services that are required for artificial intelligence and other compute-intensive, GPU-accelerated workloads,” said TierPoint chairman and CEO Jerry Kent. “This new financing positions us to answer client demand, continue growing, and providing the cutting-edge service, support, highly available, and reliable operations for which we are known.”
Founded in 2010, Argo-owned TierPoint operates around 40 data centers across 18 US markets, mostly in second-tier cities. The company has expanded through a mixture of new builds and acquisitions, including Colo4, Perimeter Technology Center, Adhost Internet Advertising, Baltimore Technology Park, Philadelphia Technology Park, Xand, CxP Data Centers, Altered Scale, Windstream Hosted Solutions, and Cosentry.
Guggenheim Securities, LLC acted as sole structuring advisor and lead bookrunner for the securitized notes. Deutsche Bank Securities, Inc., TD Securities (USA) LLC, Barclays Capital, Inc., and ING Financial Markets LLC also acted as active bookrunners for the term notes. Jeffries LLC and J.P. Morgan Securities LLC acted as passive bookrunners. Simpson Thacher & Bartlett LLP served as counsel to TierPoint and Latham & Watkins LLP as counsel to Guggenheim.
