On 16 November 2015 NEXTDC Limited (ASX Code: NXT) announced a new issue, NEXTDC Notes II.. The size of the offer is indicated at $70 million but will change based on demand. The purpose of this transaction is to help fund the development of its new data centres.
NEXTDC is part of a fast growing industry, linked to tremendous global growth in data and traffic (Internet and mobile), with high barriers to entry, both in terms of capital or operationally. Locations and size are critical to be able to better serve its customers. Whilst this is a capital intensive industry due to the nature of the contracts, revenues tend to be relatively predictable and recurring. Additionally, as NEXTDC is carrier neutral it is able to provide more choices to its customers and the ability for them to connect to each other (cross connects) - a high value-add and margin product for the company.
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Source: ASX and NEXTDC Limited
