Kao Data, the pioneer in the development and operation of data centers engineered for AI and advanced computing, has announced it has successfully completed a new, £206 million debt raise, with an accompanying accordion facility extendable to £356 million, via one of the world’s leading lenders to the data center sector, Deutsche Bank.
Matthew Harris, Kao Data’s CFO, expressed his gratitude to the lenders for their trust in the company’s philosophy and ambition, which has been fully vindicated during the last decade.
“ Looking forward, we are delighted to be working with one of the world’s leading digital infrastructure lenders in Deutsche Bank.” he said.
The debt financing will enable Kao to progress with its already contracted developments with customers, as well as the build-out of its KLON-06 data center in Slough.
In addition, the funding will help Kao’s expansion into new markets in the UK and across Europe.
A portion of the funding will also go towards refinancing existing lenders, enabling Kao Data to consolidate its debt with a single large financial services organization.
This includes Downing LLP, a UK-based investment firm that has partnered with Kao since its earlier development debt requirements, starting in 2017.
“Since our first meeting with the company’s founders in 2015, we’ve been early believers in Kao Data’s expertise, mindset, and its vision for growth. We were delighted to provide Kao Data with growth capital funding in 2017 and saw an attractive opportunity to support them in the development of their sustainable data centre platform,” said Tom Phillips the Head of Institutional Business Development at Downing.
“During the term of our investment, Kao Data has proved itself as an excellent example of what we look for in the businesses we like to back: a high-quality management team with a compelling business case. We are proud to have helped the company establish a firm foothold as a leader in one of the world’s most competitive, international data centre markets, whilst also delivering a successful return for our funds.”
Kao Data’s Impressive Portfolio and Milestones
Kao Data’s advanced data center portfolio now includes more than 160MW of IT-load, either currently operational, under development or planned – all of which is underpinned by the highest energy efficiency, sustainability, and environmental, social, and corporate governance (ESG) credentials.
In December 2023, Kao completed its second Harlow data center while simultaneously submitting plans for a Stockport, Manchester facility.
Kao Data was founded in 2014, and specializes in high-performance data centers for advanced computing, and currently has an operational combined footprint of 40MW, and a total planned footprint of 160MW.
The company houses the Nvidia Cambridge-1 supercomputer in one of its data centers at the Harlow campus.
Kao Data’s NVIDIA DGX-Ready Harlow campus, located in the London-Cambridge UK Innovation Corridor, is the largest data centre development in the country.
As a result it has become synonymous with all forms of high density, GPU accelerated computing and remains home to some of the UK’s leading and large scale bioinformatics, life sciences and research workloads
Shaping the Future of European Data Centers
The European data center market, a bustling sector valued at US$14.2 billion by 2028, is on the cusp of a significant transformation. In the heart of this change is the burgeoning influence of Artificial Intelligence (AI).
The integration of AI into data center infrastructures is not just a trend, but a necessity in the face of rising demand for data processing and storage.
In Europe, the market has evolved rapidly over the past decades, with the rise of cloud computing, video streaming, and 5G networks more recently driving a surge in demand for data processing and storage.
However, the traditional data center infrastructure is no longer sufficient to support the next level of digital transformation that AI promises.
Research shows the development of new data centers has become more expensive in recent years.
Turner & Townsend’s latest data center construction index, for example, shows there was a marked increase in construction costs in 2022, largely driven by inflationary pressures
Google has announced an investment of $1 billion in a new data center in the UK that will boost AI innovation and support Google Cloud customers in the region.
This would be Google’s first data center in the UK.
Google invested 6.9 billion euros in European data centers between 2007-2018, which supported economic activity worth 8.8 billion euros and generated 9,600 jobs per year on average, as per a study commissioned by Google.
Earlier in 2019, Google announced plans to invest 3 billion Euros ($3.26 billion) in Europe over three years to ramp up its data center presence in the continent.
It had invested 15 billion euros ($16.32 billion) between 2007 and 2019 in Europe. Besides this announcement in the UK, Google has data centers in the Netherlands, Denmark, Finland, Ireland, and Belgium in Europe.