CoreWeave closes USD8.5b GPU-backed loan to expand cloud capacity
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The news: CoreWeave raised USD8.5 billion ($12.36 billion) from a consortium of banks and investors to finance its cloud computing capacity expansion in what it describes as the biggest and first chip-backed debt deal of its kind.
The numbers: CoreWeave will be able to initially borrow USD7.5 billion under the agreement, increasing to USD8.5 billion “as underlying assets reach stabilisation.”
The context: In a statement released Tuesday, the US based cloud and AI company said the investment-grade rated financing is secured by microchips and an associated customer contract. Bloomberg reported last month that the debt is backed by contracts CoreWeave has with Meta worth at least USD19 billion.
The loan comes as the industry races to fund its push toward building out the infrastructure required to meet demands of the AI boom.
Brannin McBee, chief development officer and co-founder of CoreWeave said the deal reflects confidence in AI adoption and represents “continued market validation of our model that is proving both repeatable and scalable, enabling us to meet accelerating demand from our customers.”
MUFG and Morgan Stanley acted as co-structuring agents and joint bookrunners, while Goldman Sachs and JP Morgan served as additional coordinating lead arrangers for the transaction, which was oversubscribed. Blackstone was an anchor investor.
The sources: CoreWeave press release, Bloomberg
