The issuance of Microsoft-linked data center bonds may increase to $3.9 billion

Comparatively, according to Bloomberg, a $3.9 billion bond issue related to Microsoft has attracted more than $8 billion in investor demand, prompting the issuer to increase the transaction size by about $1 billion compared to the initial target.

The bond will be issued through a Blackstone-backed subsidiary of QTS Realty Trust LLC to finance a data center project in Georgia, USA. The debt is expected to be issued by two special-purpose liability subsidiaries of QTS's QualityTech LP.

The coupon interest rate for this bond issue is expected to be around 6%. At the same time, it will be issued at a discount, bringing the actual yield of 7% to the middle. Although the bond is expected to receive an investment grade rating, its yield level is comparable to that of a single B-grade junk bond.

Citi, Goldman Sachs, J.P. Morgan Chase, and Morgan Stanley held a conference call with investors last week to introduce the bond issue. The bank mentioned above is responsible for underwriting the transaction, and the bond has been promoted to the market for several days in a row.

The bond deal is likely to be priced as soon as Tuesday, but related discussions are still ongoing, and the final issuance plan may still change.