Business Context and Reporting Period
Company: Digital Realty Trust, Inc. and Digital Realty Trust, L.P.
Filing Type: Form 8-K (Current Report)
Date of Report: September 14, 2020
Event: Commencement of an offering of Euro-denominated Guaranteed Notes by Digital Dutch Finco B.V., an indirect wholly owned finance subsidiary.
Key Financial Metrics
This filing is a current report regarding a capital market event and does not contain audited financial statements, revenue, profit, cash flow, or margin data for a specific reporting period.
- Debt Instrument 1: Euro-denominated Guaranteed Notes due 2032 ("2032 Notes").
- Debt Instrument 2: Euro-denominated Floating Rate Guaranteed Notes due 2022 ("2022 Notes").
- Structure: Senior unsecured obligations of Digital Dutch Finco B.V., fully and unconditionally guaranteed by Digital Realty Trust, Inc. and the operating partnership.
- Registration Status: Offered outside the United States under Regulation S; not registered under the Securities Act of 1933.
Material Changes and Use of Proceeds
The filing details the intended allocation of net proceeds from the new debt offerings:
- 2032 Notes Proceeds: Intended to finance or refinance "Eligible Green Projects" (green building, energy efficiency, renewable energy). Pending allocation, proceeds may be used to temporarily repay borrowings under global revolving credit facilities, acquire properties, fund development, or for general corporate purposes.
- 2022 Notes Proceeds: Intended to fund the potential full redemption of Digital Stout Holding, LLC's 4.750% Guaranteed Notes due 2023. Alternatively, proceeds may be used to temporarily repay revolving credit facilities, acquire properties, fund development, or for general corporate purposes.
- Contingency: The closing of the 2022 Notes is not contingent on the 2032 Notes, and vice versa. Final terms are subject to pricing and market conditions.
Guidance, Outlook, and Risks
Forward-Looking Statements: The filing contains forward-looking statements regarding the timing and consummation of the offering and the use of proceeds. There is no assurance that the transactions will be consummated on the described terms or at all.
Risks and Contingencies:
- Consummation is subject to market conditions and customary closing conditions.
- Final terms of the Euro Notes will be determined at the time of pricing.
- General risks include legislative, regulatory, and competitive changes affecting the data center industry.
- Investors are referred to the Form 10-K (year ended Dec 31, 2019) and Form 10-Q (quarters ended March 31, 2020, and June 30, 2020) for a comprehensive list of risk factors.
Investor Verification Checklist
- Verify the final pricing and terms of the 2032 and 2022 Euro Notes once the offering is priced.
- Confirm whether the offering was successfully consummated given the stated market conditions.
- Monitor the actual allocation of proceeds, specifically whether the 2022 Notes were used to redeem the Digital Stout Holding, LLC 4.750% Notes due 2023.
- Review the company's subsequent filings for updates on the "Eligible Green Projects" funded by the 2032 Notes.