This article first appeared on GuruFocus.
Apollo Global Management (NYSE:APO) and Blackstone (NYSE:BX) are working to bring additional investors into a roughly $36 billion debt financing deal that could help Anthropic build the AI infrastructure needed to support its next stage of growth. The financing would be used to purchase Google’s custom TPU chips, which Anthropic would then lease, according to people familiar with the matter. Broadcom (AVGO), which helps Google develop those chips, is backstopping payments on the largest portions of the transaction, giving the proposed deal a stronger credit foundation than Anthropic may be able to provide on its own as a high-growth startup.
The deal could mark one of the largest private credit transactions ever and possibly the biggest chip-financing debt transaction to date. For investors, the setup matters because it shows how the AI buildout is moving beyond traditional data center financing and deeper into chip-backed credit structures. Anthropic announced Thursday that it raised $65 billion in a separate funding round that valued the company at $965 billion, marking the first time its valuation surpassed OpenAI’s. Shares of Broadcom and Google parent Alphabet (GOOGL) rose in late trading after the news, with Broadcom gaining as much as 1.9% to $434.84 and Alphabet advancing as much as 1.2% to $394.81.
The structure is expected to use a special-purpose vehicle that borrows money, receives an equity investment, buys the TPUs and leases them to Anthropic. Anthropic plans to use the chips at sites in New York, Texas, Louisiana and Indiana, according to one person familiar with the matter. The financing is expected to include roughly $6 billion of A1 notes, $25 billion of A2 notes and $4.5 billion of B notes, though final amounts could change. Broadcom’s residual value support agreement would help protect senior A1 and A2 investors if Anthropic fails to make lease payments for a certain period, potentially aligning those notes more closely with Broadcom’s investment-grade credit profile while keeping Broadcom and Anthropic at arm’s length from the transaction.
