SpaceX Eyes $40 Billion Loan for Nvidia Chips
Elon Musk’s SpaceX is engaged in discussions with banks and investors to secure $40 billion for the procurement of chips from Nvidia Corp., according to sources. This move would represent one of the largest debt financings in the context of AI development. Pacific Investment Management Co. is among the investment managers evaluating the deal, according to sources. SpaceX’s fundraising discussions are currently in the preliminary phase and may conclude without reaching a finalised agreement, they indicated. Musk’s AI, satellite and rocket conglomerate is aiming to secure approximately $10 billion in bank loans and $30 billion in investment-grade debt to finance the chips, as reported earlier by source, referencing unnamed sources with knowledge of the situation.
Apollo Global Management Inc. is spearheading the financing in a transaction anticipated to conclude in 2027, according to the reports. Technology firms and artificial intelligence model creators are allocating and securing hundreds of billions of dollars to construct and lease expansive data centers equipped with chips to drive AI systems. The global increase in computing capacity has driven up the prices of various assets, including land, chips, and power-generation equipment, resulting in a wave of substantial financing agreements. Broadcom Inc.’s Wall Street syndicate is in the process of assembling $60 billion in new financing for AI chips, aimed at supporting Anthropic PBC and other companies, according to sources. Nvidia, SpaceX, and Apollo did not provide immediate responses to requests for comment. SpaceX shares relinquished their earlier gains in postmarket trading, declining by 1.2% to $169.79.
Nvidia’s stock experienced a modest increase. Just last month, Musk indicated that Colossus 2, an AI computing cluster developed by his xAI business, could potentially more than double its existing Nvidia chip count by year-end. It represents the most comprehensive schedule that the trillionaire has provided to date regarding the expansion strategies for the Memphis-area cluster. Colossus 2 now has 110,000 Nvidia GB200 chips and 440,000 GB300s, Musk stated in a post on X. A further 220,000 GB300s are set to become operational next week, with an additional 220,000 anticipated in November, he stated. An additional 220,000 may come online late December “if we get lucky,” he stated. Musk’s xAI has enlisted several prominent financial institutions to evaluate its Grok chatbot, including Apollo and Morgan Stanley. Apollo was among the US investment giants that Nvidia tapped for a high-profile partnership in August to source $500 billion in financing for AI infrastructure.
The coalition – which also includes Blackstone Inc., BlackRock Inc., Brookfield Asset Management, Goldman Sachs Group Inc. and KKR & Co. – said at the time that they’d “create dedicated pools of capital at significant scale at attractive rates for Nvidia customers.” Executives indicated that the focus will be on debt financing to provide access to compute for Nvidia’s largest customers and signalled that numerous deals are already in progress that would qualify toward this commitment. Apollo has engaged in additional agreements with Elon Musk’s enterprises, including a $7 billion financing arrangement for xAI in exchange for access to Nvidia. The debt was designated for a special purpose vehicle intended to assist Musk’s startup in renting chips for its Colossus 2 data-center location in Memphis.
