Key Takeaways
- • Galaxy Digital prices $3.507 billion in senior secured notes due 2031 at 9.875% coupon, with an expected closing date of July 28, 2026, to finance a major data center expansion in Texas.
- • Texas project will deliver 400 MW of utility capacity and 260 MW of critical IT capacity across two buildings with eight data halls on a 260-acre property in Dickens County, positioning Galaxy for AI and enterprise data center demand.
- • Notes feature 4.00% annual amortization (subject to adjustment) with semi-annual interest payments beginning February 1, 2027, and are fully guaranteed by Galaxy Helios II LLC with first-priority liens on substantially all subsidiary assets.
- • Private placement structure (Rule 144A/Reg S) indicates institutional investor targeting, with debt service reserves funded alongside project development to de-risk construction and operational phases.
- • Multi-year project timeline reflects capital-intensive infrastructure play, with amortization deferred until at least ten months after project completion, signaling a five-year build-to-operation arc aligned with AI data center supply constraints.
Summary
Galaxy Digital Inc. announced the pricing of a $3.507 billion offering of senior secured notes due August 1, 2031, via its indirect subsidiary Galaxy Helios Data Centers II LLC. The notes carry a coupon of 9.875% per annum, payable semi-annually beginning February 1, 2027. The offering is structured as a Rule 144A/Reg S private placement expected to close on July 28, 2026, indicating a predominantly institutional investor base.
Net proceeds will finance approximately half the development and construction costs of a major data center complex in Dickens County, Texas. The project encompasses two buildings containing eight data halls with a combined 400 megawatts of utility capacity and 260 megawatts of critical IT capacity, positioned on approximately 260 acres. This capacity profile aligns with enterprise and AI workload demand, addressing the current supply-constrained market for premium colocation infrastructure.
The debt structure incorporates conservative amortization mechanics designed to match cash flow generation with repayment obligations. The notes amortize at 4.00% per annum of the original principal amount (subject to adjustment), with semi-annual payments commencing at least ten months after project completion. This deferral structure protects near-term liquidity during the construction and ramp phase. The notes are fully and unconditionally guaranteed by Galaxy Helios II LLC and secured by first-priority liens on substantially all assets of the issuer and guarantor, excluding certain carve-outs, and all equity interests held by the direct parent company.
The offering includes funding for debt service reserves alongside project development capital, a prudent approach to mitigate refinancing and operational risk during the build-out phase. Galaxy's capital structure reflects the long-duration, capital-intensive nature of data center infrastructure development in high-demand markets, where utility and IT capacity constraints support premium economics for newly constructed facilities.
Net proceeds will finance approximately half the development and construction costs of a major data center complex in Dickens County, Texas. The project encompasses two buildings containing eight data halls with a combined 400 megawatts of utility capacity and 260 megawatts of critical IT capacity, positioned on approximately 260 acres. This capacity profile aligns with enterprise and AI workload demand, addressing the current supply-constrained market for premium colocation infrastructure.
The debt structure incorporates conservative amortization mechanics designed to match cash flow generation with repayment obligations. The notes amortize at 4.00% per annum of the original principal amount (subject to adjustment), with semi-annual payments commencing at least ten months after project completion. This deferral structure protects near-term liquidity during the construction and ramp phase. The notes are fully and unconditionally guaranteed by Galaxy Helios II LLC and secured by first-priority liens on substantially all assets of the issuer and guarantor, excluding certain carve-outs, and all equity interests held by the direct parent company.
The offering includes funding for debt service reserves alongside project development capital, a prudent approach to mitigate refinancing and operational risk during the build-out phase. Galaxy's capital structure reflects the long-duration, capital-intensive nature of data center infrastructure development in high-demand markets, where utility and IT capacity constraints support premium economics for newly constructed facilities.
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