Teraco Secures $678m Loan For Expansion

Teraco, a provider of data centers in South Africa, has been given a $678 million loan. Absa Group, a South African lender, led the loan. The business stated that "many big financial institutions" provided the cash, but did not identify them. Teraco, a subsidiary of Digital Realty, will utilize the funds to finance the company's continuing expansion and to restructure current obligations. Just under fifty percent of the total loan, about $327,500,000, will be allocated to future projects. The remaining funds will be utilized to prolong the average maturities of outstanding drew debt to 2028, a 2,9-year extension. The refinanced facilities are located in Johannesburg, Cape Town, and Durban.

The expansion funds will be utilized to develop Teraco's current hubs in Isando, Bredell, and Cape Town, as well as the company's "major renewable energy generating initiative." Bloomberg reports that Teraco's renewable energy initiative would entail the funding of a 100MW solar farm and the installation of solar panels on the rooftops of its data centers. Once Teraco receives clearance from the South African authorities and national energy firm Eksom, construction may begin on the solar farm.

This is Teraco's second loan facilitated by Absa. The firm funded $170 million in 2021 to finance the building of the Johannesburg data center, which was finished in August of that year. In January 2022, Digital Realty purchased the firm in a deal valued at $3.5 billion. Since Teraco's takeover, the business has built a fourth data center in Johannesburg and revealed the November commencement of a fifth.