The NextDc Ltd (ASX: NXT) share price is frozen today at $11.78 at the company's request.
The S&P/ASX 200 Index (ASX: XJO) tech share has been a strong outperformer in 2023. As you can see in the chart below, the NextDC share price is up 31% year to date.
The NextDC share price freeze will lift on Monday after management announces the outcome of the institutional component of an accelerated entitlement offer.
What's all that about?
Read on.
Image source: Getty Images
Why is the ASX 200 tech company raising $618 million?
This morning NextDC reported it will develop two new data centres as part of its regional expansion strategy.
The centres will be constructed on recently acquired commercial property sites in Kuala Lumpur, Malaysia and Auckland, New Zealand.
The new projects, alongside an accelerated fit out at its S3 centre, will be funded by a $618 million fully underwritten 1 for 8 pro-rata accelerated non-renounceable entitlement offer.
The offer prices of $10.80 per share represents a discount of just over 8% from the current NextDC share price.
This led NextDC to also update its FY23 guidance. The new forecast is for:
- Data centre services revenue in the range of $350 million to $360 million (previously the upper end of the $340 million to $355 million range)
- Underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) in the range of $192 million to $196 million (previous range: $190 million to $198 million)
- Capital expenditure in the range of $670 million to $720 million (previous range: $620 million to $670 million)
Commenting on the new developments that could offer the NextDC share price some tailwinds in the year ahead, CEO Craig Scroggie said, "Building upon the success we have achieved in Australia over the past decade, we aim to replicate our proven business model in these new markets."
Hinting at further growth plans, Scroggie added, "New Zealand and Malaysia are just the first greenfield geographic expansion opportunities outside of Australia."
NextDC share price snapshot
The NextDC share price is up 15% over the past full year. Longer-term the ASX 200 tech share has gained 57% over five years.
