QTS Realty Trust driving by with $400 million eight-year notes; initial talk high 3% to 4% area

By Paul A. Harris

Portland, Ore., Sept. 23 – QTS Realty Trust, Inc. plans to price a $400 million offering of eight-year senior notes (existing ratings Ba3/BB) in a Wednesday drive-by trailing a late-morning conference call with investors, according to market sources.

Initial talk has the Rule 144A and Regulation S for life deal coming to yield in the high 3% to 4% area, according to a bond trader.

Goldman Sachs & Co. LLC is the left bookrunner. BMO Capital Markets Corp., Jefferies LLC, KeyBanc Capital Markets Inc., TD Securities (USA) LLC, Truist Securities Inc., BofA Securities Inc., Capital One Securities Inc., Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, Mizuho Securities USA Inc., Morgan Stanley & Co. LLC, RBC Capital Markets Corp., Regions Securities LLC, Stifel Nicolaus & Co. Inc. and Santander Investment Securities Inc. are the joint bookrunners.

The notes become callable after three years at par plus 50% of the coupon.

The issuing entities will be QualityTech, LP and QTS Finance Corp.

The Overland Park, Kan.-based provider of data center solutions plans to use the proceeds to pay down its revolver, which will subsequently be redrawn in order to fund the redemption of its 4¾% senior notes due 2025.

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