SpaceX is in talks to raise $40 billion in debt financing led by Apollo Global Management to purchase Nvidia, the Financial Times reported, quoting people familiar with the matter.
Elon Musk’s artificial intelligence and rocket company is seeking to raise about $10 billion in bank loans and $30billion in investment -grade debt.
The fundraising highlights the vast sum required to support the AI boom amid the competition to acquire advanced chips and computing capabilities.
Bond Fund Pimco is among a small number of lenders in talks to provide financing, the FT reported.
Morgan Stanley estimates that AI infrastructure will require $1.5 trillion in external financing by 2028.
The cost of funding to finance these deals would be expensive due to rising sovereign bond yields.
Lenders and investors are cautious about funding the industry's expansion.
Shares of SpaceX fell 1.6% in the overnight market, while NVDA rose 0.5%.
Ali Merchant is a seasoned financial markets professional specializing in technical analysis, treasury & capital markets, trading, research, and fund management. He is Strategic Advisor at Musaffa and Founder of TWT Learning, which provides education, research, and advisory services to fund and hedge managers and family offices. Ali has traded FX, FX options, US stocks & options, indices, commodities, oil and metals futures, and holds a CMT charter with memberships in AAPTA and CMT, US & Canada. He has worked with ABN AMRO, Thomson Reuters/Refinitiv, MAK Allen & Day Capital, and Bridge Information Systems, produced TA reports for Bloomberg and Reuters, and trained 2,000+ market participants across North America, the GCC and Asia.
