What's happening with the NextDC share price following today's $1.3 billion announcement?

ASX 200 investors are weighing the ramifications of NextDC's $1.3 billion announcement.

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The NextDc Ltd (ASX: NXT) share price isn't doing anything just yet. Though early indications are that shares may open modestly lower.

Shares in the S&P/ASX 200 Index (ASX: XJO) tech stock closed yesterday trading for $16.71. In morning trade on Thursday, shares remain there, after the company requested a trading halt.

That halt is meant to lift following the company's announcement of a major capital raising. That announcement has since been made. But as of now, we're still waiting.

Here's what we know.

NextDC share price one to watch following cap raise

The NextDC share price is in the spotlight after the company announced it is undertaking a $1.321 billion capital raising via a fully underwritten 1 for 6 pro-rata accelerated non-renounceable entitlement share offer.

New shares will be issued for $15.40, some 8% below where the NextDC share price closed.

The ASX 200 tech stock noted that it's been experiencing record demand for its data centre services. In calendar year 2023, the company's contracted utilisation increased by 77% to 149.0MW.

Looking at what could impact the NextDC share price ahead, the company expects that a record forward order book of 68.8MW will convert into billings across FY 2025 to FY 2029, which management said will drive future revenue and earnings growth.

With that growth in mind, the ASX 200 tech company intends to deploy the $1.321 billion to accelerate the development and fit out of its digital infrastructure platform in its core Sydney and Melbourne markets.

The company reported that once the capital raising is complete, it will have pro-forma tangible asset backing of approximately $5.1 billion and pro-forma liquidity of around $3.4 billion.

What did management say?

Commenting on the capital raising that could move the NextDC share price today, CEO Craig Scroggie said:

NextDC continues to see significant growth in demand for its data centre services underpinned by powerful structural tailwinds.

Amid this backdrop, we have decided to bring forward the development and fitout of key assets in Sydney and Melbourne to ensure we are able to meet this growth in demand, continue to support our customers, and ensure the company is well positioned to take advantage of the diverse range of opportunities expected to present over the medium term.

NextDC maintains guidance

The NextDC share price could get a boost after the company maintained the FY 2024 guidance it initially offered on 27 February.

That guidance is as follows:

  • Total revenue in the range of $400 million to $415 million
  • Net revenue in the range of $296 million to $304 million
  • Underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) in the range of $190 million to $200 million
  • Capital expenditure in the range of $850 million to $900 million

The NextDC share price is up 51% over the past 12 months.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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