Helping AirTrunk towards net zero with sustainability-linked loan

Hyperscale data centre specialist AirTrunk has chosen Deutsche Bank to help arrange a 4.6 billion Australian dollar sustainability-linked loan (SLL). The loan allows it to grow its industry-leading cloud infrastructure platform across the Asia Pacific region, while being held accountable to improving its environmental and social commitments.

The loan is a refinancing of AirTrunk’s first SLL in 2021, on which Deutsche Bank also played a leading role highlighting its ability to help transition businesses towards net zero.

Deutsche Bank acted as mandated lead arranger, underwriter, bookrunner and sustainability structuring agent on the loan. It is one of the largest syndicated financing deals for a hyperscale data centre* in Asia Pacific.

The loan is the latest in a run of transactions for which AirTrunk has picked Deutsche Bank to lead, repeatedly drawing on Deutsche Bank’s financing, corporate banking, and risk management expertise.

A sustainability-linked first

SLLs link a company’s financing to meaningful environmental and social commitments. One way to do this is through the loan’s key performance indicators (KPIs), established to track the sustainability performance of the borrower against the terms of the loan.

This SLL for AirTrunk is the first for a data centre to combine carbon, power and water usage effectiveness as part of the loan’s KPIs. The financing incentivises AirTrunk to meet its sustainability targets and sets a benchmark for the highest level of transparency and accountability in addressing core ESG issues in the data centre industry.

The loan is the first publicly known financing by a data centre to incorporate a gender pay equity target in its KPIs, reflecting AirTrunk’s commitment to diversity, equity and inclusion.

We are proud to have helped AirTrunk extend what sustainability means for the data centre industry globally and cement its leadership as the most sustainable data centre operator in the world.Kalpana Seethepalli, Deutsche Bank’s APAC Head of ESG Impact Measurement.

The loan sets another important benchmark in sustainable financing; it is the largest SLL for a data centre operator globally.

AirTrunk will invest the incentives realised by meeting the loan KPIs into social impact initiatives, including those aimed at driving equality in digital access, STEM education, and biodiversity and conservation. This is the first time a data centre has used margin incentives in this way.

AirTrunk has driven innovation and transparency by redefining the KPIs at the core of the data centre industry and pegging them to financing terms to achieving ambitious sustainability targets.  

Seethpalli is part of Deutsche Bank’s ESG Centre of Excellence; the first of its kind for a bank in Asia Pacific. The team collaborates across divisions to structure ESG-compliant deals that embed sustainability in clients’ commercial strategies and help them accelerate their sustainable ambitions.

*A hyperscale data centre requires a multi-megawatt (MW) power supply of 5MW plus to support hyperscale cloud providers and large tech companies with needs for scalable power, storage and cooling.