Merlin Signs €3.75 Billion Sustainable Financing to Extend Debt Maturities
Key Facts
Merlin Properties announced on November 2 that it signed €3.75 billion in sustainable corporate financing on October 30 with a syndicate of local and international banks. In a filing published with Spain’s securities market regulator, the company said the financing is structured in two tranches: a term loan and a revolving credit facility. The transaction is part of a reshaping of debt maturities, with part of the term loan allocated to repay financing due in 2028 and a bond maturing in 2027. The other available portion will cover future financing needs, particularly the company’s data center program. Merlin says the combination of transactions removes maturities over the next three years and provides financial flexibility to execute its growth strategy, while keeping its leverage ratio at 25%.
The term loan includes a €725 million tranche, which was scheduled to be drawn on November 3, 2026, to repay ahead of schedule the syndicated loan due in 2028. The second tranche amounts to €1.525 billion and remains available until April 30, 2027. It is intended to repay a €500 million bond maturing on July 3, 2027, as well as fund future needs. The company specifically cited its data center program among those needs, indicating that the financing is not being directed entirely toward expansion in that business. Alongside this, the revolving credit facility is being expanded from €740 million to €1.5 billion, increasing the credit liquidity available to the company.
Merlin closed the financing at an average cost of MS + 100 basis points, according to its filing. The average debt maturity rose from 3.7 years before the transaction to 5.3 years afterward, reducing the concentration of near-term maturities, the company said. Merlin also repaid a €800 million bond on November 2, the day it matured. It used funds available in its treasury from previous financings for the repayment, according to the filing, rather than the loan tranche scheduled to be drawn the following day. Debt management therefore covered a current maturity, alongside early financing for future obligations and the provision of a larger revolving facility.
The company’s earlier results provide context for its debt and liquidity levels before the transaction. At the end of 2025, Merlin recorded gross revenue of €565 million and EBITDA of €416 million, while average debt maturity was 4.4 years and the LTV ratio was about 28.9%. At the end of the first half of 2026, the LTV ratio had fallen to 24.5%, liquidity stood at €2.571 billion, and average debt maturity was 4.0 years. After the financing, the company said its LTV ratio was 25% and its average debt maturity had reached 5.3 years. The comparison shows that the transaction extended maturities relative to their level at the end of the first half, while leverage remained close to that level under the company’s measure.
Data centers are one of the growth areas Merlin cited when outlining the future uses of the financing. In the first half of 2026, the company generated gross revenue of €308 million and EBITDA of €229 million, while FFO was about €180 million and accounting net profit was €579 million. Merlin raised its 2026 financial-year FFO forecast to €340 million, equivalent to about €0.55 per share, according to results published in July. That same month, it said it had 160 megawatts leased or pre-leased in the second phase of its data center plan and expected to exceed its 200-megawatt target for 2026. The first phase, with capacity of 64 megawatts, was fully leased in 2025, and the company estimated it would generate €97 million in gross rents in 2027.