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Green Finance / Treasury & Capital Markets
SMBC closes US$313.8 million SLL deal in Indonesia
EdgeConnex taps sustainability-linked financing for Jakarta data centre expansion
The Asset 15 Nov 2023

EdgeConneX, a US developer and operator of data centres, has secured a US$313.8 million sustainability-linked loan (SLL) to fund the expansion of its data centre in Jakarta, Indonesia.

Sumitomo Mitsui Banking Corporation (SMBC) is one of the four mandated lead arrangers and original hedge counterparties in the transaction. The financing, the first of its kind in Indonesia’s data centre market, represents the inaugural SLL transaction for EdgeConneX in the region.

EdgeConneX says the deal paves the way for increased sustainability capabilities, including power efficiency, renewable energy sources, and enhanced safety measures, enabling the company to raise the capacity of its Jakarta hyperscale campus  to over 120 megawatts.

The SLL format provides for margin adjustments when EdgeConneX meets certain key performance indicators concerning the power usage effectiveness of its data centres, the use of renewable electricity, and the achievement of safety goals. 

The targets are consistent with EdgeConneX’s mid- and long-term sustainability strategy and commitments and are aligned with the Asia Pacific Loan Market Association’s (APLMA) SLL principles.

The transaction marks SMBC’s third data centre project financing in Indonesia, as well as the second successful closing with EdgeConneX in Asia. The bank is committed to achieving a sustainable finance portfolio of 50 trillion yen (US$332 billion) by 2030.

Southeast Asia’s data centre market is expected to accelerate, underpinned by increased data consumption, greater cloud spending by businesses, rising digital adoption by governments, a surge in hyperscaler demand and the evolution of new technologies like artificial intelligence.

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