Global Switch secures new credit with HSBC for long-term data center finance
APAC/Europe data centre provider Global Switch has now officially closed a new revolving credit facility with HSBC Bank, which will bring around S$768.4 million in financing.
The new revolving credit facility (RCF) includes all previous lenders, Barclays, Credit-Suisse, Deutsche Bank and HSBC. The Bank of China has also joined as a lender and mandated lead arranger.
The new RCF offers many opportunities for Global Switch, including a longer duration, an S$88.4 million increase in facility size and better pricing compared to the last one.
"This new RCF is very good news for Global Switch; we are extremely pleased with the exceptional terms that reflect the strength of our business model and balance sheet. The new contractual terms also provide certainty and flexibility of funding and will help support our next phase of growth and development of the business,” explains Global Switch CEO John Corcoran.
The RCF’s new margin is at sub 1% and the committed facility term matures in April 2021. The improved financial terms represents ‘industry leading pricing’, which means Global Switch can continue to deliver solutions that provide value for money and generate returns for shareholders, the company says.
Global Switch believes that the long-term commitment from the participating banks shows that the company is strong and continuing to display low leverage, as displayed in its credit ratings.
“We are delighted to confirm the continuing long-term support of HSBC, Barclays, Credit Suisse and Deutsche Bank, and we welcome Bank of China as a new lender under the RCF. We remain fully committed to maintaining low leverage over the long run and to further consolidating our current strong investment grade credit ratings,” adds Global Switch CFO David Doyle.
In December 2016, Global Switch introduced a new strategic vendor that represents a consortium of Chinese corporate and institutional investors.
In the same month, Global Switch also secured two major customer pre-commitments for data center services in Singapore and Hong Kong.
The new strategic investor will help grow Global Switch access to telcos and internet providers looking to expand out of China, as well as bring existing Chinese bank relationships to a level that broadens lending support.