Record $38 Billion Debt Sale Nears for Oracle-Tied Data Centers, Bloomberg Reports

Banks are preparing to launch a $38 billion debt offering as soon as Monday that will help fund data centers tied to Oracle in what would be the largest such deal for artificial intelligence infrastructure to come to market, according to people with knowledge of the matter, Bloomberg reported.

JPMorgan Chase & Co. and Mitsubishi UFJ Financial Group are among banks leading the deal, which is split across two separate senior secured credit facilities, said the people, who asked not to be identified when discussing private matters. One $23.25 billion package will go toward financing a data center in Texas and another $14.75 billion facility will help fund a project in Wisconsin, the people said.

Vantage Data Centers is developing both data centers, which are set to be used by Oracle to power OpenAI, Bloomberg has reported. The projects are part of Oracle’s broader effort to invest $500 billion in AI infrastructure alongside OpenAI, known as Stargate.

Wells Fargo & Co., BNP Paribas SA, Goldman Sachs Group Inc., Sumitomo Mitsui Banking Corp. and Societe Generale SA have been allocated portions of the financing package after a first round of selecting underwriters, the people said.

Representatives for JPMorgan, MUFG, SMBC and OpenAI declined to comment. Oracle, Vantage and the other banks didn’t immediately respond to requests for comment.

Investors have been clamoring for exposure to AI for months, with banks and private credit firms vying to lead the massive debt packages needed to fuel the boom. Meta Platforms Inc. recently selected Pacific Investment Management Co. and Blue Owl Capital Inc. to lead a $29 billion debt and equity deal for its data-center expansion in rural Louisiana.

The Vantage debt comes about a week after bonds for the Meta deal started trading in secondary markets, surging as much as 10 cents on the dollar and handing Pimco about $2 billion in paper profits.

Both facilities for Vantage are expected to mature in four years, with two one-year extension options, and price around 2.5 percentage points over the benchmark, the people said. Similar to project and commercial real estate financings, the loans will be structured as interest-only during the construction phase but will begin to amortize after operations begin, the people said.

The managers closed the second round of underwriting earlier this week, during which the debt was allocated to other banks and institutional investors, they said.