Applied Digital Agrees to Build a Partnership with Macquarie Asset Management for Funding of up to $5.0 Billion to Drive HPC Growth

Core Viewpoint - Applied Digital Corporation has secured a $5.0 billion perpetual preferred equity financing facility to support its high-performance computing (HPC) data center business, positioning itself for significant growth in the industry [2][5]. Financing Details - The financing agreement involves an investment from Macquarie Asset Management (MAM), which will provide $2.25 million for each executed lease of 1 MW of capacity, totaling up to $900 million for the full 400 MW build-out of the Ellendale HPC Campus [3][7]. - The investment proceeds will be utilized to complete the Ellendale HPC Campus, repay approximately $180 million in existing bridge debt, recover an estimated $300 million of equity investment, fund general and administrative expenses, and cover transaction costs [4][7]. Ownership and Equity Structure - MAM's investment will result in an 85% ownership stake in both existing and future HPC assets, minimizing dilution for Applied Digital's public stockholders [7]. - The preferred equity will accrue a dividend at a rate of 12.75% per annum, with a potential increase after five and six years if still outstanding [8]. Strategic Positioning - The partnership with MAM is expected to establish Applied Digital as a leading HPC data center owner and operator in the U.S., with the capability to construct over 2.0 GW of HPC data center capacity [5][6]. - The company aims to leverage its unique power portfolio and advanced technologies to deliver efficient data center solutions tailored for AI and HPC workloads [9]. Market Outlook - As demand for AI innovation grows, Applied Digital is positioned to deliver next-generation data center solutions and GPU cloud services, catering to complex AI and HPC applications [9].