Monday morning, Interxion announced that it is accelerating data center expansions in Amsterdam and Frankfurt in response to customer orders. As a result of this, Interxion is increasing its guidance for capital expenditures in 2014. To support its updated capital expenditure plan, the company announced it has entered into a new €100 million senior secured credit facility. We believe the strong bookings momentum in Amsterdam and Frankfurt are indicative of how Interxion is able to successfully win deals in two of Europe’s most-competitive data center markets and also indicative of improving economic health throughout Europe. As a result of these expansions and Interxion’s typical deployment method, we believe that Interxion will be able to fill the space quickly, and will carry this momentum throughout the year.
Guidance for capital expenditures in 2014 were increased from €140 million-€160 million to a range of €175 million-€200 million.
Interxion has established a €100 million senior secured facility with ABN Amro Bank N.V. and Barclays Bank PLC to support the increased projections for capital expenditures. The new facility has an initial maturity date of April 14, 2015 with the option to extend the maturity date by a further two 6-month periods up to a maximum of 12 months. The annual interest rate is equal to EURIBOR plus a margin of 2.75%. The interest rate margin has a maximum of 5.75%.
Interxion will accelerate completion of the AMS 7 construction by adding two phases totaling approximately 2,600 m² of equipped space to the four previously announced phases (which had totaled 4,600 m²). The AMS 7 data center will total 7,200 m² at completion. The first phase of AMS 7 (AMS 7.1), with approximately 1,000 m², opened in the first quarter of 2014. The remaining five phases are scheduled to open during the third quarter 2014 through second quarter 2015 period. The capital expenditure associated with the complete buildout of all six phases of AMS 7 is expected to be about €115 million.
Interxion is scheduled to report first-quarter earnings on May 7 before the market open.