Microsoft-linked data center bond offering rises to $3.9 billion amid strong investor demand

ME News reports that on August 18 (UTC+8), a $3.9 billion bond issuance linked to Microsoft attracted over $8 billion in investor demand, prompting the issuer to increase the deal size by approximately $1 billion from its original target. The bonds will be issued through a subsidiary of QTS Realty Trust LLC, backed by Blackstone, to finance a data center project in Georgia, USA. The debt is expected to be issued by two special-purpose limited liability subsidiaries of QualityTech LP, a subsidiary of QTS. The coupon rate for the bonds is expected to be around 6% at the high end, with the bonds issued at a discount to achieve an effective yield in the low to mid-7% range. Although the bonds are anticipated to receive an investment-grade rating, their yield level is comparable to that of single-B rated junk bonds. Citigroup, Goldman Sachs, JPMorgan Chase, and Morgan Stanley held investor conference calls last week to present the bond offering. These banks are serving as underwriters for the transaction, and the bonds have been marketed to the market for several consecutive days. The bond deal could price as early as Tuesday, but discussions are still ongoing, and the final issuance plan remains subject to change. (Source: BlockBeats)