Apollo and Blackstone Just Closed a $35 Billion Private Credit Deal to Finance Anthropic's Compute Expansion. Here's What It Means for Micron and Nvidia.
Written by Catie Hogan for The Motley Fool -> The $35 billion will be used to facilitate Anthropic's data center capacity expansion. As more money piles into the construction of AI infrastructure, demand for Micron's high-bandwidth memory increases. Two of the largest asset ma
The $35 billion will be used to facilitate Anthropic's data center capacity expansion.
As more money piles into the construction of AI infrastructure, demand for Micron's high-bandwidth memory increases.
Two of the largest asset managers on Wall Street are rewriting the rules of AI infrastructure financing, and the deal they just made public is sure to have a substantial impact on the industry as a whole. What does it mean in particular for Micron (NASDAQ: MU) and Nvidia (NASDAQ: NVDA) , two of the biggest winners of the AI build-out thus far?
Apollo Global Management (NYSE: APO) and Blackstone (NYSE: BX) finalized a $35 billion financing deal to aid Anthropic in its expansion efforts. The agreement is one of the largest private credit deals ever.
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The deal is structured using a Special Purpose Vehicle (SPV) to purchase Tensor Processing Units (TPUs) from Alphabet 's Google. Those will then be leased to Anthropic. Through this structure, Anthropic will keep the hardware off its balance sheet. This will be a useful financial tool as Anthropic prepares for its initial public offering. Those TPUs will be deployed in data centers starting sometime this year and will expand Anthropic's compute capacity by 1 gigawatt (GW).
Broadcom is also an integral part of the deal and is providing a crucial credit endorsement through residual value guarantees for $30 billion in debt tranches. Apollo's Atlas SP Partners contributed an additional $800 million in equity.
Broadcom CEO Hock Tan explained that the company is building an "AI XPV platform" with Apollo, Blackstone, and other top investors to deploy over 20 GW of compute through 2028 for both Anthropic and OpenAI.
