EQT-backed data centre operator EdgeConneX is preparing to bring its first European securitisation offering to the market, having lined up joint lead managers for the trade alongside arranger Morgan Stanley, according to 9fin sources.
The other banks involved are Barclays, Natixis, Société Générale, ABN Amro and ING, said the sources.
Barclays has established a leading role in the nascent European data centre ABS market, having worked on every deal in the region to date, while the other banks have all provided EdgeConneX with financing in the past.
ABN Amro has particularly strong links with the company. Group treasurer Eelco Holst, who is based near Amsterdam, was previously an executive director in the Dutch bank’s project finance team, according to his LinkedIn profile.
Other former ABN Amro bankers at EdgeConneX include Marjolein Heida and Laura Godschalx, per LinkedIn.
EdgeConneX has been working on a possible public data centre securitisation in Europe since last year, when Morgan Stanley arranged meetings with ABS and CMBS investors, as 9fin reported in October.
The transaction is now taking shape and expected to be announced soon. “I don’t think you’ll be waiting too long,” said one person familiar with the project.
Catching up
The entrance of a new operator will be a welcome boost for the European data centre securitisation market, which is lagging behind the US.
US data centre securitisation issuance started in 2018 and has grown to about $25bn a year, according to a recent report from RBC Capital Markets. In Europe, the figure is less than €1bn a year.
By the end of 2025, only one operator had securitised its European data centres. That company, Vantage Data Centers, had completed two transactions, denominated in sterling and euros and securitising facilities in Cardiff and Berlin, respectively.
So far this year, one other operator, Yondr, has entered the market, securitising data centres in the UK town of Slough with a £532m deal called Yondr UK 2026-1.
Barclays and Goldman Sachs were the bookrunners on the offering of double A-rated fixed-rate notes, which were priced at 165bps over Gilts, or a yield of 5.546%, on 20 February.
Data centre operators are eager to develop the ABS market further because refinancing operational assets in the capital markets frees up bank balance sheets to finance the construction of new projects.
Choices
All of the European data centre ABS issued so far has been fixed-rate, limiting its appeal to the region’s structured credit investors, whose strategies tend to be built around floating-rate exposures. However, there has been sufficient demand among a combination of ABS and corporate bond funds that can accommodated fixed-rate ABS, including US funds.
Yondr is understood to have considered including a floating-rate component in its debut, but decided against it for now. The issuance of floating rate notes would entail swapping the data centres’ long-term fixed-rate cashflows into floating to avoid a mismatch.
Several bankers have told 9fin they expect the introduction of a portion of floating-rate debt to be one of the next steps in the development of the European data centre ABS market.
“If you split it and you have 100m or 150m of floating-rate, you’ll get enough demand for that from the institutional investors, and you’ll get more pricing leverage on the fixed-rate tranche because it’s smaller,” said one banker.
Tough call
Another way to drum up more demand, especially among insurers, would be to adjust the non-call period, said the banker.
Yondr’s recent offering featured a par-call window commencement date in August 2029, two years before the anticipated repayment date in February 2031. This gives the issuer the flexibility to refinance the deal within that window without incurring a penalty, but is off-putting to some investors.
The first Vantage deal features a similar provision, allowing the issuer to redeem the notes at par between December 2028 and the step-up date in June 2030.
“What if you match the non-call to the step-up?” mused the banker. “More demand comes that way, but less flexibility for the issuer.”
The structure of EdgeConneX’s European data centre ABS debut is expected to be broadly in line with the previous deals.
In Europe, the company has operational data centres in Amsterdam, Barcelona, Brussels, Dublin, Munich, and Warsaw, and it is planning to build one in Frankfurt.
In 2024, EdgeConneX announced that it had expanded its sustainability-linked financing by $1.9bn to support its digital infrastructure expansion in EMEA. The company said the financing consolidated its portfolio across the region, shifting it from standalone project-based funding to a structured corporate debt package.
EdgeConneX did not respond to a request for comment. Morgan Stanley, Barclays and ABN Amro declined to comment and the other banks did not immediately respond to inquiries.
