Analysts at Jarden believe Infratil’s move to update the market on the value of the $10bn CDC business makes sense, in the context of it being a precursor to a sale in the next 12 months.
It comes after DataRoom reported in July that investment bank Barrenjoey had been tapped for a possible selldown of by one of CDC’s owners, with Commonwealth Super known to be interested in divesting its holding.
In a research note, analysts at Jarden said the recent sale of data centre giant AirTrunk (offloaded for $24bn to Blackstone and CPP) confirmed a large appetite for quality data centre assets does exist, supporting the chance of CDC rerating on coming capital raises or a selldown.
“We believe a partial CDC stake selldown or new equity partner valuation marker is possible over the next 12 months.”
The Australia and New Zealand listed infrastructure owner updated the market on CDC’s new valuation on Friday.
Infratil’s latest quarterly independent valuation for its 48.2 per cent stake in CDC Data Centres is now between $4.4bn and $5.3bn.
In its last annual report, Infratil said the fair value was $NZ4.4bn ($4.04bn),
The valuation indicated a 409 megawatt uplift to the data centre’s operator’s development pipeline out to the 2034 financial year, being now at 2,296 megawatts.
It cites a continued high level of interest from customers, resulting in the advancement of customer discussions for capacity across all regions in which it operates.
The growth is focused in Melbourne with at least 315MW and Auckland, at least 84MW.
No new data centre expansions have reached final investment decision yet and earnings before interest, tax, depreciation and amortisation guidance is unchanged.
Equity contributions for the business are at least $700m, at least $100m ahead of guidance, reflecting the likelihood of more projects reaching FID over that period, Jarden said.
Australian infrastructure asset manager Morrison & Co purchased CDC Data Centres in 2016 for about $1.1bn on behalf of Infratil and Commonwealth Super.
In 2020, Commonwealth Super Corp sold half of its 48.2 per cent interest to the Future Fund.
Data centres are one of the most popular investment choices in the current market, being in demand with the rise of artificial intelligence.
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