Summary
Digital Realty Trust, Inc. (DLR) announced on October 10, 2018, the pricing of a £400 million offering of 3.750% Guaranteed Notes due 2030. These notes are senior unsecured obligations of its subsidiary, Digital Stout Holding, LLC, and are fully guaranteed by DLR and its operating partnership. The offering is being conducted offshore under Regulation S, with no registration under the U.S. Securities Act. The company intends to use the net proceeds for general corporate purposes, including repaying borrowings under credit facilities, funding acquisitions and development opportunities, and potentially for debt repayment or repurchase. This issuance represents a strategic move by Digital Realty to secure long-term financing denominated in British Pounds Sterling, likely to align with its international operations and potentially hedge currency risk. The annual interest rate of 3.750% is a key detail for investors assessing the cost of capital. The planned use of proceeds suggests a focus on deleveraging and growth initiatives, which are crucial for REITs like Digital Realty to enhance shareholder value.
Key Highlights
- 1Digital Realty priced a £400 million offering of 3.750% Guaranteed Notes due 2030.
- 2The notes are senior unsecured obligations of Digital Stout Holding, LLC.
- 3The offering is fully and unconditionally guaranteed by Digital Realty Trust, Inc. and its operating partnership.
- 4The notes are being offered and sold outside the United States under Regulation S.
- 5Interest on the GBP Notes will be paid annually at a rate of 3.750%.
- 6Net proceeds are intended for repaying credit facility borrowings, acquisitions, development, and general corporate purposes.
- 7Settlement of the offering is expected on October 17, 2018, subject to customary closing conditions.