Hut 8 closes $1.07B secured revolving credit facility dedicated to AI data-centre buildout

Hut 8 (NASDAQ: HUT) announced on Monday that it closed a four-year senior secured revolving facility with $1.07 billion in capacity on September 24, expanding parent-level borrowing capacity for AI data center development. The facility carries an initial margin of 175 bps on Term SOFR borrowings.

The facility was undrawn at closing. Up to $1.07 billion of the overall commitment can be used for letters of credit, which cover deposits tied to interconnections and amounts owed to utility providers and equipment vendors without requiring cash collateral.

The credit agreement establishes a Term SOFR margin range of 150 to 200 bps, with the applicable rate determined by a comparison of Hut 8's consolidated total debt to its market capitalization. Unused initial commitments carry an annual fee of 25 bps.

"This facility adds more than $1 billion of committed, non-dilutive bank liquidity at the parent level, giving us the ability to fund projects through development while we determine the optimal timing and structure for long-term, non-recourse financing as they de-risk," said Hut 8 CFO Sean Glennan.

Certain restricted subsidiaries serve as loan party guarantors. The facility is secured by liens ranking ahead of other claims against substantially all assets of Hut 8 and the guarantors, subject to specified exclusions. Beginning with the quarter ending March 31, 2027, Hut 8 must maintain quarter-end liquidity equal to at least 40% of aggregate commitments until a defined Stabilization Date, then 25%.

In its August second-quarter results, Hut 8 reported 949 MW of IT capacity under contract with approximately $26.6 billion in expected value across the contracts' base terms.

The parent-level revolver is separate from the company's project-level AI campus financing, which totals $7.5 billion, is non-recourse, and amortizes in full. That portfolio comprises a $3.25 billion River Bend bond and a $4.25 billion Beacon Point bond.