By Roushni Nair
(Reuters) -Australia's HMC Capital on Thursday unveiled plans to launch DigiCo REIT, a new digital infrastructure real estate trust focused on data centers, in the country's largest initial public offering of 2024 valued at A$2.75 billion ($1.8 billion).
Shares in HMC rose as much as 2.2% to a record high of A$11.99 in early trade, compared to a 0.4% jump in the benchmark S&P/ASX 200 index.
HMC is capitalizing on the global surge in data center demand driven by the AI revolution.
DigiCo REIT IPO will surpass both payment services provider Cuscal's A$337 million offering and Mexican food chain Guzman Y Gomez's A$335.1 million listing, making it the largest such deal this year in Australia.
The Australian bourse has seen a resurgence in listings this year, rebounding from 2023 which saw the fewest listings in 10 years. The number of new listed entities on the ASX stood at about 77 IPO's as of Nov. 20, already surpassing about 57 IPO's seen in fiscal 2023.
HMC, founded by banker-turned-investor David Di Pilla, said strong interest from investors led the expansion of the IPO by A$100 million, with phased trading set to begin on Dec. 12.
DigiCo REIT will manage A$4.3 billion worth of data center assets across the U.S. and Australia, initially anchored by A$2.5 billion worth of strategic operating assets in Australia acquired from Global Switch (NYSE:SWCH) Australia and iseek. According to an earlier HMC filing, iseek will reinvest A$250 million worth of the purchase price into the DigiCo IPO.
After the ASX listing of DigiCo REIT, HMC will hold an 18% stake worth A$500 million and see its assets under management surge by 73% to A$17.5 billion in 2024.
As part of DigiCo REIT's formation, HMC and DigiCo REIT also secured deals to acquire three North American enterprise and hyperscale data centers for A$1.5 billion, which will be incorporated into DigiCo REIT's portfolio, the company said.
($1 = 1.5370 Australian dollars)