This is the biggest sustainability linked loan for a data centre operator worldwide, firm says
Gilbert + Tobin (G+T) has advised the lenders in the refinancing of the corporate sustainability linked loan (SLL) of AirTrunk’s existing debt facilities to $4.6bn.
The firm said this transaction represents the “largest loan deal in the Australian market in 2023” and is also the “largest ever sustainability linked loan for a data centre operator globally.”
G+T advised the mandated lead arrangers, underwriters, and bookrunners involved in the transaction, which includes Deutsche Bank, Credit Agricole, Morgan Stanley, HSBC, MUFG, ING, and DBS, among others. The $4.6bn SLL more than doubles AirTrunk’s initial $2.1bn SLL, which closed in September 2021.
In addition to refinancing AirTrunk’s existing debt facilities, the deal is set to support the expansion of the company’s operations throughout the APJ region.
AirTrunk said in a media release that the landmark SLL set the bar for sustainable financing in a number of ways. The loan connects AirTrunk’s financing to KPIs such as carbon usage effectiveness (CUE), operating power usage effectiveness, and operating water usage effectiveness; it is the first SL to apply a CUE metric and the first to incorporate all these KPIs. This, AirTrunk said, ensures “the highest level of environmental transparency and accountability for a data centre operator.”
“The SLL also represents the first publicly known financing by a data centre company to incorporate a gender pay equity target, reflecting AirTrunk’s commitment to diversity, equity and inclusion,” the company said.
AirTrunk added that it “intends to invest all margin incentives from the SLL into social impact initiatives including equal digital access, STEM education, biodiversity and conservation, and innovation and research & development.”
“This landmark SLL ensures that as we scale across the region, we do so as sustainably as possible, driving the industry forward by redefining sustainable financing standards,” said Prashant Murthy, AirTrunk’s chief financial and commercial officer. “The SLL KPIs also align to our Net Zero by 2030 strategy and further hold us accountable to achieve our climate goals.”
The G+T team handled every aspect of the deal and spearheaded the structuring, documentation, execution, and syndication of the facilities. According to the firm, the transaction was “significant in terms of its scale and complexity involving 7 MLAUBs, across multiple markets”.
Banking partner Stuart Cormack led the G+T team. He was supported by Jack Naughton, Catrina Chen, Maxwell Collins, Jonathan Mo, Zoe Spanos, and Anany Verma.
The $4.6bn refinancing does not include AirTrunk’s ongoing $1.2bn sustainable finance venture in Japan. At present, the company has amassed over $6bn in ESG financing.
