In order to design, construct, and run hyperscale data centers across the Middle East, Quantum Switch Tamasuk (QST), a joint venture between Tamasuk of Saudi Arabia and Quantum Switch of the United Kingdom, has announced full funding for its first hyperscale data center in King Salman Energy Park (SPARK) in Dammam, Saudi Arabia.
This new data center in Saudi Arabia will primarily support a new cloud area that will help Saudi Arabian businesses and organizations better achieve their goals of digitalization through the provision of higher-quality and more reliable digital services.
Natixis Corporate & Investment Banking (Natixis CIB), serving as the structuring bank to QST, is responsible for structuring and fully underwriting the financing for this new data center in King Salman Energy Park. Allianz Trade and Riyad Bank received a portion of the loan that Natixis CIB later syndicated.
More financial institutions will be able to join in financing QST’s data center portfolio thanks to the financing arrangement, which has been especially designed to incorporate additional data centers into the existing framework. This would give QST a reliable supply of debt financing to finance its planned development in the region, which will require up to $3 billion in capital over the course of the following four to five years.
“This transaction stands out for its innovative structure and is a strong testament to the banking sector’s appetite for growth in the digital infrastructure space in Saudi Arabia, as well as their confidence in QST as a data center developer for international hyperscaler customers in the region,” said Matthew Nathan, Chief Executive Officer (CEO) at Tamasuk. “I am extremely grateful to the Natixis CIB team in the Middle East and their senior leadership for their belief and trust in QST”.
Institutional Investor Financing
Approximately 18 months after breaking ground in King Salman Energy Park, QST’s data center is already in the advanced phases of development and is anticipated to be ready for commercial operations in Q4 2022. Additionally, QST has begun construction of a second data center, which will also be located in Dammam and be completed in Q2 2023.
“We are delighted to have led and distributed the project financing for QST. It represents our first data center financing in the region, a sector in which Natixis CIB has deep experience in globally,” said Bénédicte De Giafferri, Global Head of Real Assets Finance at Natixis CIB. “The portfolio financing structure was a perfect fit for our client’s development pipeline, and we are excited to support QST’s capital requirements in a space where we see tremendous growth potential. We are especially proud to have sourced an institutional investor financing, this area of liquidity is particularly important to us and offers both sustainability and continuity to future funding requirements for our clients.”
“Quantum Switch exists to blend the best in data center design, technology, building and operations with innovative financial models and partnerships that allow us to bring new capacity on stream for our clients in new and emerging cloud regions at high speed,” said Tim Bawtree, CEO at Quantum Switch. “The SPARK facilities are proof of this concept in action.”