Latest news with #BlueOwl
Yahoo
2 days ago
- Business
- Yahoo
Meta Lands Record $29B AI Data Center Deal -- Private Credit's Biggest Bet Yet
Private credit's biggest names have been waiting for an opening like this and Meta Platforms Inc. (NASDAQ:META) just handed them one. This week, Pacific Investment Management Co. and Blue Owl Capital Inc. secured a $29 billion financing package for Meta's new AI-focused data center in Louisiana, a rare move into the investment-grade debt arena typically owned by Wall Street banks. Pimco is arranging $26 billion in debt, Blue Owl is committing $3 billion in equity, and Morgan Stanley is advising on the structure, which is expected to be backed by the data center's assets. It's the largest single-project AI data center financing to date, potentially setting a new precedent for private credit's role in big-ticket infrastructure. Warning! GuruFocus has detected 6 Warning Sign with META. The timing reflects an accelerating AI build-out across the U.S. Elon Musk's xAI Corp. has told investors it aims to spend $18 billion on data centers, while Inc. and OpenAI Inc. are pursuing their own large-scale sites. Morgan Stanley estimates capital expenditures tied to AI could surpass $3 trillion in the next three years. Securing Meta's deal was highly competitive Apollo Global Management Inc. and KKR & Co. reached the final round, with Brookfield Asset Management Ltd., Blackstone Inc., and Ares Management Corp. also vying for the mandate. By scale, Meta's project stands well above other recent AI infrastructure financings, most of which have been under $10 billion. For private credit, this could be the start of a deeper move into investment-grade opportunities, a market Apollo sees as potentially reaching $40 trillion. With corporate M&A slowing, the sector is looking to deploy an estimated $450 billion in available capital into new asset classes. Blue Owl CEO Marc Lipschultz has compared the AI push to a modern Gold Rush only here, the picks and shovels are the funding structures behind the data centers. If Meta's deal proves successful, it could become a template for large-scale, asset-backed financing that bypasses the traditional bank syndication model. This article first appeared on GuruFocus. Sign in to access your portfolio
Yahoo
4 days ago
- Business
- Yahoo
Meta Just Landed $29 Billion for AI -- And Wall Street's Power Players Are Fighting to Join In
Meta Platforms (NASDAQ:META) Inc. is making a $29 billion infrastructure bet to stay ahead in the AI arms raceand some of Wall Street's biggest names are backing it. Pacific Investment Management Co. (Pimco) is leading a $26 billion debt package, likely structured as investment-grade bonds secured by the assets of Meta's upcoming data center in rural Louisiana. Blue Owl Capital Inc. (NYSE:OBDC) is providing $3 billion in equity. Morgan Stanley ran the fundraising process, which drew aggressive bids from Apollo Global and KKR before Pimco and Blue Owl emerged as lead financiers. Blue Owl shares jumped 2.4% in premarket trading. Meta rose 0.4%. Warning! GuruFocus has detected 8 Warning Signs with OBDC. This isn't just another capex line itemMeta is using this financing to push harder into AI infrastructure, a segment executives say is already contributing meaningful revenue. On its latest earnings call, CFO Susan Li said spending will increase further next year as Meta targets hard-to-find AI talent and builds scalable systems to support training and inference workloads. She also hinted at more project-based financing models in the future, noting that Meta's infrastructure strategy could attract significant external financing while still offering the company operational flexibility over time. For private capital, the Meta deal could be a blueprint for what comes next. Investors are rushing into asset-based finance tied to AI data centers, a market that McKinsey says may require $6.7 trillion by 2030. It's not just MetaMicrosoft (NASDAQ:MSFT) recently partnered with BlackRock to raise $30 billion, while Elon Musk's xAI secured $5 billion in syndicated debt. Apollo also just took a controlling stake in Stream Data Centers. With infrastructure and credit now colliding in the AI boom, these deals might be early signals of how the next decade of tech will be financed. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Bloomberg
5 days ago
- Business
- Bloomberg
Meta Expands Aggressively on Data Centers
Open Interest Meta's is partnering with Pimco and Blue Owl in the race for AI infrastructure to expand on the need for land and power, reports Bloomberg's Mandeep Singh. (Source: Bloomberg)
Yahoo
5 days ago
- Business
- Yahoo
Meta Picks Pimco, Blue Owl for $29 Billion Data Center Deal
(Bloomberg) -- Meta Platforms Inc. has selected Pacific Investment Management Co. and Blue Owl Capital Inc. to lead a $29 billion financing for its data center expansion in rural Louisiana as the race for artificial intelligence infrastructure heats up, according to people with knowledge of the matter. All Hail the Humble Speed Hump Three Deaths Reported as NYC Legionnaires' Outbreak Spreads Mayor Asked to Explain $1.4 Billion of Wasted Johannesburg Funds Major Istanbul Projects Are Stalling as City Leaders Sit in Jail What England's New National Cycling Network Needs to Get Rolling Pimco is expected to lead a $26 billion debt portion of the financing, while Blue Owl is providing $3 billion of equity, said the people, who asked not to be identified because the discussions are private. The debt portion is likely to be issued in the form of investment-grade bonds backed by the data center's assets, they said. The social media company has been working with Morgan Stanley to raise funds in a competitive process that pitted some of the largest names in private credit against each other. Apollo Global Management Inc. and KKR & Co. were also vying to lead the financing until the final round of talks, said the people. Other investors may be added at a later stage, they added. Representatives for Meta, Pimco and Blue Owl declined to comment. Morgan Stanley did not immediately respond to a request for comment. Blue Owl Capital shares were up 2.4% in premarket trading on Friday. Meta climbed 0.4%. Private investment firms have been aggressively seeking to deploy capital in transactions secured by physical assets or for higher-rated companies in a bid to differentiate their business. Many see the multi-trillion dollar market for private asset-based finance and data centers in particular as a massive opportunity to expand their revenue streams. Research by the the management consulting firm McKinsey & Co Inc. estimates that data centers will require $6.7 trillion to meet demand for computing power globally by 2030. AI Development The Meta financing will help the firm accelerate its development of artificial intelligence, which executives have said is already producing 'meaningful' revenue for the company. Meta said costs will grow at an even faster pace next year — particularly as it focuses on AI infrastructure needs and the niche technical talent that can fine-tune its models. 'We generally believe that there will be models here that will attract significant external financing to support large-scale data center projects that are developed using our ability to build world-class infrastructure while providing us with flexibility should our infrastructure requirements change over time,' Chief Financial Officer Susan Li told investors during an earnings call last week. Other tech giants have partnered with investment firms to fund AI data centers. Microsoft Corp. has teamed up with BlackRock Inc. to raise $30 billion in private equity capital for strategy that could deploy as much as $100 billion in the space, while Elon Musk's xAI Corp. raised $5 billion in the broadly syndicated debt market in June as it pushes ahead with the build-out of advanced AI models. Earlier this week, Apollo said it had agreed to buy a majority stake in Stream Data Centers. --With assistance from Kat Hidalgo. (Updates with stock price movements in paragraph five.) The Pizza Oven Startup With a Plan to Own Every Piece of the Pie Digital Nomads Are Transforming Medellín's Housing Russia's Secret War and the Plot to Kill a German CEO It's Only a Matter of Time Until Americans Pay for Trump's Tariffs The Game Starts at 8. The Robbery Starts at 8:01 ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
5 days ago
- Business
- Yahoo
Meta Picks Pimco, Blue Owl for $29 Billion Data Center Deal
(Bloomberg) -- Meta Platforms Inc. has selected Pacific Investment Management Co. and Blue Owl Capital Inc. to lead a $29 billion financing for its data center expansion in rural Louisiana as the race for artificial intelligence infrastructure heats up, according to people with knowledge of the matter. All Hail the Humble Speed Hump Three Deaths Reported as NYC Legionnaires' Outbreak Spreads Mayor Asked to Explain $1.4 Billion of Wasted Johannesburg Funds Major Istanbul Projects Are Stalling as City Leaders Sit in Jail What England's New National Cycling Network Needs to Get Rolling Pimco is expected to lead a $26 billion debt portion of the financing, while Blue Owl is providing $3 billion of equity, said the people, who asked not to be identified because the discussions are private. The debt portion is likely to be issued in the form of investment-grade bonds backed by the data center's assets, they said. The social media company has been working with Morgan Stanley to raise funds in a competitive process that pitted some of the largest names in private credit against each other. Apollo Global Management Inc. and KKR & Co. were also vying to lead the financing until the final round of talks, said the people. Other investors may be added at a later stage, they added. Representatives for Meta, Pimco and Blue Owl declined to comment. Morgan Stanley did not immediately respond to a request for comment. Private investment firms have been aggressively seeking to deploy capital in transactions secured by physical assets or for higher-rated companies in a bid to differentiate their business. Many see the multitrillion dollar market for private asset-based finance and data centers in particular as a massive opportunity to expand their revenue streams. Research by the the management consulting firm McKinsey & Co Inc. estimates that data centers will require $6.7 trillion to meet demand for computing power globally by 2030. AI Development The Meta financing will help the firm accelerate its development of artificial intelligence, which executives have said is already producing 'meaningful' revenue for the company. Meta said costs will grow at an even faster pace next year — particularly as it focuses on AI infrastructure needs and the niche technical talent that can fine-tune its models. 'We generally believe that there will be models here that will attract significant external financing to support large-scale data center projects that are developed using our ability to build world-class infrastructure while providing us with flexibility should our infrastructure requirements change over time,' Chief Financial Officer Susan Li told investors during an earnings call last week. Other tech giants have partnered with investment firms to fund AI data centers. Microsoft Corp. has teamed up with BlackRock Inc. to raise $30 billion in private equity capital for strategy that could deploy as much as $100 billion in the space, while Elon Musk's xAI Corp. raised $5 billion in the broadly syndicated debt market in June as it pushes ahead with the build-out of advanced AI models. Earlier this week, Apollo said it had agreed to buy a majority stake in Stream Data Centers. --With assistance from Kat Hidalgo. (Updates with McKinsey research on data center financing estimates in paragraph 6) The Pizza Oven Startup With a Plan to Own Every Piece of the Pie Digital Nomads Are Transforming Medellín's Housing Russia's Secret War and the Plot to Kill a German CEO It's Only a Matter of Time Until Americans Pay for Trump's Tariffs The Game Starts at 8. The Robbery Starts at 8:01 ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
