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The NextDC Ltd (ASX: NXT) share price is making gains today, with shares of the tech stock trading up 0.6% to AU$15.70 apiece at 3:18 PM AEST. This follows a flat close at AU$15.55 per share yesterday, in line with the broader S&P/ASX 200 Index (ASX:XJO) which is up 0.47% at the same time.
Here's a closer look at what's driving the movement in the NextDC share price.
The uptick in the NextDC share price comes as the company announces the opening of the retail component of its capital raising entitlement offer. Last Thursday, NextDC unveiled an AU$1.32 billion capital raising, resulting in a two-day trading halt for its shares.
The capital raising, conducted through a 1 for 6 entitlement share offer, aims to accelerate the development and fitout of NextDC's core data centre assets in Sydney and Melbourne.
CEO Craig Scroggie highlighted the robust demand for NextDC's data centre services, driven by strong structural tailwinds. The successful completion of the institutional component of the entitlement offer on Monday raised approximately AU$937 million, with shares issued at AU$15.40 each.
Scroggie expressed satisfaction with the support received from existing institutional shareholders, positioning NextDC to capitalise on the growing demand for data centre services.
Today, eligible retail shareholders have the opportunity to participate in the retail entitlement offer at the same price of AU$15.40 per share. NextDC anticipates the retail component to raise around AU$384 million, with the offer closing on May 2.
In addition to the entitlement offer, eligible retail shareholders have the option to apply for additional shares, up to 100% in excess of their entitlement, at the offer price.
As the company focuses on expanding its data centre infrastructure, attention is drawn to the significant electricity demand anticipated from AI-enabled data centres. While NextDC is committed to sustainability and renewable energy solutions, Scroggie emphasised the need for reliable baseload power, suggesting nuclear energy as a potential solution.
"We need power, we need transmission networks, we need green energy, we need more solar, we need more wind and, frankly, we need nuclear," Scroggie stated.
As NextDC progresses with its capital raising and expansion plans, investors are monitoring developments closely, particularly in light of the growing demand for data centre services and the company's strategy to address energy requirements sustainably.
