VisionWave Holdings, Inc. (NASDAQ: VWAV) announced it has signed a non-binding term sheet with Lucky Whale Production Limited, a Hong Kong-incorporated project sponsor, to establish a jointly-held company for the proposed development of a Tier IV data center campus in Beth Shemesh, Jerusalem district, Israel.

Under the proposed structure, VisionWave would hold a 68% stake in the joint company, which would in turn hold 75% of the project-level special purpose vehicle, giving VisionWave an effective look-through interest of approximately 51% in the project. As consideration, VisionWave would issue shares of common stock valued at approximately $40 million, priced by volume-weighted average price near closing, with no cash component. The company noted the issuance would be dilutive to existing stockholders.

The proposed Phase-1 build is contemplated to comprise approximately 15,000 square meters across 10 data halls, targeting 10.5 MW of IT load. The project is described as an underground hardened structure targeting Tier IV certification by the Uptime Institute. These specifications are preliminary and have not been independently verified by VisionWave.

VisionWave would also commit to arranging the full capital required to construct and commission the data center through capital-markets activity and/or institutional project financing. The company stated there is no assurance that such financing would be available on acceptable terms.

"We are pleased to have signed a term sheet for a proposed joint venture to develop a Tier IV data center in Israel," said Doug Davis, Chief Executive Officer of VisionWave Holdings. "Completion of the transaction remains subject to a number of conditions, and we will provide further updates as appropriate."

The proposed transaction remains subject to due diligence, execution of definitive agreements, and required corporate, stockholder, SEC, and Nasdaq approvals. There is no assurance the transaction will be completed on the described terms or at all. VisionWave filed a Current Report on Form 8-K with the SEC in connection with the announcement.