Guess which ASX All Ords share is raising $1.1 billion to back generative AI

The ASX All Ords company announced a billion dollar capital raising. Here's why.

| More on:
A white and black robot in the form of a human being stands in front of a green graphic holding a laptop and discussing robotics and automation ASX shares

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The All Ordinaries Index (ASX: XAO) is down 0.5% on Monday morning, but this ASX All Ords share isn't making any moves just yet.

Shares in the New Zealand based company infrastructure investment company entered a trading halt before the opening bell this morning at the company's request.

This came on the heels of a major AI related capital raise announcement earlier this morning.

Any guesses?

If you said Infratil Ltd (ASX: IFT), go to the head of the virtual class.

Here's what's happening.

ASX All Ords share tips hat for $1.1 billion

Infratil said it intends to raise NZ$1.15 billion (approximately AU$1.1 billion) to fund data centre operator CDC's accelerating growth. The new funds will also be used to provide more flexibility for growth across the ASX All Ords shares' global portfolio.

The equity raising comprises an underwritten1 NZ$1.0 billion placement of new IFT shares and a NZ$150 million non-underwritten retail offer of new IFT shares.

New shares will be issued for NZ$10.15 apiece. That's 6.8% below Friday's closing price.

"CDC continues to see a surge in demand for data centre capacity," Infratil CEO Jason Boyes said. "Demand continues to accelerate on the back of cloud adoption and significant investments in generative AI."

He noted that CDC has been one of Infratil's top investments. The ASX All Ords share's stake in CDC is valued at NZ$4.42 billion. That's 10 times what the company first invested in 2016.

According to Boyes:

This rapid increase in demand has seen CDC enter advanced negotiations with customers for over 400MW of capacity at multiple sites across the CDC footprint with this capacity expected to come online over the next four to five years.

CDC expects at least 200MW of capacity to commence construction over the next 12 months. And Infratil said it expects to commit equity funding of around AU$600 million to the data centre developer over the next two years.

"CDC's growth has accelerated considerably recently, driven by rapid growth in AI-driven data demand," Boyes said.

CDC CEO Greg Boorer added:

We are seeing an unprecedented increase in the number of customer discussions, many of which are tied to AI-related workloads. CDC has been AI-ready for more than 15 years and is well positioned to capture strong share of AI-driven demand.

Infratil said there was no change to its FY 2025 guidance.

Infratril share price snapshot

If you look back at the chart up top, you'll notice a remarkably stable long-term uptrend in the Infratil share price.

Over the past 12 months, the ASX All Ords share has gained 14.3%.

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.

More on Share Market News

Lion roaring in the wild, symbolising a rising Liontown share price.
Share Gainers

Here are the top 10 ASX 200 shares today

ASX investors once again pulled back from record highs today.

Read more »

Good news has these businesspeople cheering for joy, partying in a board room.
Bank Shares

2 uniquely Australian reasons why ASX 200 bank shares are outperforming global peers

Three of the Big Four ASX 200 bank shares hit new price milestones today.

Read more »

A group of friends party and dance in the desert with colourful confetti all around them.

ASX 200 to finish 2024 higher than expected: AMP

AMP says there were 3 factors that drove the ASX 200 to its new record high above 8,000 points this…

Read more »

a line up of job interview candidates sit in chairs against a wall clutching CVs on paper in an office setting.

Why did the ASX 200 dip on the latest unemployment figures?

The labour market remains stubbornly resilient with only a minute increase in unemployment last month.

Read more »

Man holding fifty Australian Dollar banknote in his hands, symbolising dividends, symbolising dividends.
Share Market News

Buy these top ASX ETFs for income in FY 2025

These ETFs could be worth a look if you're searching for income.

Read more »

A woman ponders over what to buy as she looks at the shelves of a supermarket.
Consumer Staples & Discretionary Shares

Have ASX investors missed their chance to buy Woolworths shares?

After a sharp recovery, Woolworths shares might not be on sale anymore...

Read more »

A rueful woman tucks into a sweet pie as she contemplates a decision with regret.

DroneShield shares taught me a $29,612 lesson. Stick to your guns

If only I knew what I know now, I'd be $29,612 better off.

Read more »

Cheerful boyfriend showing mobile phone to girlfriend in dining room. They are spending leisure time together at home and planning their financial future.
Share Gainers

Why Accent, Dusk, Evolution Mining, and Zip shares are pushing higher today

These shares are having a great session. But why?

Read more »