The debt markets are increasingly receptive to data center providers seeking expansion capital. Today the Telx Group said that it has closed a $75 million incremental term loan agreement. The colocation and interconnection provider will use the funds to supplement its liquidity and for "general corporate purposes."
Telx is the third data center provider in the past week to announce new debt financing, following the lead of Vantage Data Centers and QTS (Quality Technology Services). Taken together, the three providers have lined up $480 million in financing, much of which will go to expand their data center infrastructure.
Telx has several expansion projects underway, and others on the horizon. The company is building a 215,000 square foot greenfield colocation center in Clifton, New Jersey and has just leased 5.7 megawatts in a Vantage data center in Santa Clara, Calif. Telx also is considering additional data center space in Manhattan.
"This transaction continues to position Telx for future growth in 2012 and beyond, including the ability to quickly respond to the needs of our customers with new expansion opportunities," said Chris Downie, President and Chief Financial Officer of Telx. "We are pleased to receive continued support from the financing community in recognition of Telx’s outstanding service to its clients and strong business model."
Morgan Stanley Senior Funding, Inc. and TD Securities (USA) LLC served as lead arrangers for the transaction.
Telx is a privately held company that operates 17 data center facilities – five in the New York Metro area, two in Chicago, two in Dallas, four in California, (Los Angeles, San Francisco, and two in Santa Clara) and facilities in Atlanta, Miami, Phoenix and Charlotte, N.C. Telx is owned by ABRY Partners, LLC and Berkshire Partners LLC, two Boston-based investment firms.