SpaceX Seeks $40 Billion Debt for Nvidia AI Chips
SpaceX is structuring a $40 billion off-balance-sheet debt deal to purchase Nvidia chips for its artificial intelligence infrastructure.
Space Exploration Technologies Corp. is attempting to finalize a $40 billion off-balance-sheet debt structure to fund the purchase of Nvidia Inc. chips for its artificial intelligence buildout. The company is utilizing a special purpose vehicle managed by Apollo Global Management's Atlas SP unit to keep the liabilities off its primary books and protect its investment-grade ratings.
Goldman Sachs Group Inc. is leading the banking efforts for the transaction, while Pacific Investment Management Company is considering an investment. The move follows a previous $20 billion attempt by xAI that failed to remain off-balance-sheet, resulting in $13 billion being recorded as SpaceX debt after auditors rejected a sale-leaseback arrangement.
Recent market volatility and investor concerns regarding massive AI-related debt have complicated pricing for a subordinated tranche, which was previously discussed in the mid-8% yield range. SpaceX CFO Bret Johnsen stated the company intends to continue borrowing in a measured fashion to maintain its investment-grade status.
