The debt portion of the financing will be raised through the issuance of investment-grade bonds, backed by Meta’s data center assets.
Meta Platforms, Inc.’s (META) quest to be among the frontrunners in the artificial intelligence (AI) arena has led the company to commit multi-billion-dollar investments. The company has reportedly secured funding from two financing institutions to support its data center expansion.
Separately, an Information report stated that the Mark Zuckerberg-led company has acquired voice AI startup WaveForms.
Riding on the renewed AI thrust, Meta stock has gained over 30% this year.
Bloomberg reported, citing people familiar with the matter, that Meta has selected Pacific Investment Management Co. (PIMCO) and Blue Owl Capital to lead a $29 billion financing for its data center expansion project in rural Louisiana. PIMCO is expected to provide $26 billion in debt financing, with the remaining $3 billion to be raised through equity from Blue Owl.
The debt portion of the financing will be raised through the issuance of investment-grade bonds, backed by Meta’s data center assets.
The social-media giant was also contemplating using Apollo Global Management and KKR as lead financiers, the report said, adding that other investors might be brought in at a later stage.
Morgan Stanley reportedly was facilitating the competitive process to zero in on financiers.
In late July, while announcing the quarterly results, Meta guided to 2025 capex of $66 billion to $72 billion, raising the lower end from the previous range of $64 billion to $72 billion.
CFO Susan Li clarified on the earnings call that the increase in capital expenditures (capex) the company models for 2026 is due to scaling generative AI (GenAI) capacity as it builds out training capacity, which would drive higher spending across servers, networking, and data centers.
Big tech companies are investing heavily in high-performance computing to train AI models and applications, as well as for inference.
Zuckerberg set up a superintelligence team earlier this year to pursue artificial general intelligence (AI) and has put together a coveted talent pool. The company has also recently bought stakes or made outright purchases of AI startups.
On Stocktwits, retail sentiment toward Meta stock stayed ‘neutral’ (45/100) by late Thursday, while the message volume remained ‘low.’
In early July, Microsoft announced that it was on track to invest $80 billion in building out AI-enabled data centers to train and deploy AI models, as well as cloud-based applications worldwide. Bloomberg reported that Microsoft has enlisted the services of BlackRock to raise $30 billion for funding the expansion of its AI data centers. Elon Musk’s AI startup xAI raised $5 billion, mainly from the syndicated debt market, in June.
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