Apollo and Blackstone arrange $36 billion debt deal to fund Anthropic's AI chip expansion

Apollo and Blackstone shop a $36bn debt deal to buy Anthropic its chips

The financing would buy Google's TPUs through a special-purpose vehicle and lease them to Anthropic, with Broadcom standing behind the senior debt. The way to read the latest Anthropic financing is to notice who is not borrowing the money. Apollo Global Management and Blackstone are arranging roughly $36 billion of debt, but the loan does not sit on Anthropic's balance sheet. It buys chips, and the chips get leased back. The two firms are bringing additional investors into the deal this week, according to Bloomberg, with a close expected next week. The borrowed money flows through a special-purpose vehicle that buys Google's custom tensor processing units, the TPUs that have become Anthropic's alternative to a Nvidia-only diet, and then leases that hardware to Anthropic for use in data centres in New York, Texas, Louisiana and Indiana. It is one of the largest private-credit transactions ever assembled around a single company's compute needs, and the financial engineering is doing real work. By routing the purchase through a leasing vehicle, Anthropic gets the chips without carrying tens of billions in hardware debt directly, and the lenders get an asset-backed structure rather than an unsecured bet on a company that does not yet turn a profit. The most telling clause sits underneath the senior tranches. Broadcom, which helps Google build the TPUs, is providing a residual-value support agreement on roughly $31 billion of the senior debt. In plain terms: if Anthropic stops paying its lease and the used chips do not fetch enough on resale to cover the loan, Broadcom absorbs the shortfall. A chipmaker is, in effect, underwriting the demand for its own chips. Apollo and Blackstone intend to sell down part of the debt while keeping sizeable portions themselves, the kind of skin-in-the-game signal that helps move a deal of this size through a syndicate. Blackstone is no stranger to the borrower. The firm already holds around $1 billion of Anthropic equity and is part of a separate $1.5bn joint venture to push Claude into private-equity portfolio companies. The backdrop is an arms race in compute that has pushed Anthropic's paper value to heights that would have read as absurd a year ago. The company has been raising at valuations above $900bn, and the chip-financing deal is the physical counterpart to that number: the valuation buys the ambition, the debt buys the silicon to make it real. None of the parties has commented on the record, and the terms could still shift before close. What the structure makes plain is how the cost of frontier AI is being spread. The model developer, the cloud provider, the chip designer and the private-credit giants are now bound into a single financing, each holding a different slice of the risk that the demand for Claude keeps growing fast enough to pay for the machines being bought to serve it.

Apollo, Blackstone Arrange $36 Billion To Fund Anthropic's AI Chips - Apollo Global Management (NYSE:APO)

The sources also stated that Broadcom Inc., a key partner in developing Google's chips, is providing payment guarantees for the largest parts of the deal. Anthropic overtook OpenAI as the world's most valuable startup after raising $65 billion in Series H, valuing the company at $965 billion. Altimeter Capital, Dragoneer, Greenoaks and Sequoia Capital led the funding round. "This funding will help us serve the historic demand we are experiencing, stay at the research frontier, and bring Claude to more of the places where work happens," said Krishna Rao, chief financial officer of Anthropic. Apollo is understood to be privately seeking additional investors to participate in the chip-financing package through a debt syndication process, giving it control over which potential backers are included. Both Apollo and Blackstone plan to offload portions of the debt, while retaining meaningful stakes for themselves, sources added. Investors have been asked to submit their commitments this week, with the transaction closing next week, although talks are still ongoing and terms may change. Should the deal go as planned, this would be one of the "largest-ever" private credit deals as well as the largest chip-financing debt transaction, Bloomberg noted. Anthropic is in the midst of working on Project Glasswing, an AI-assisted security testing effort that more than 50 organizations are collaborating on. Anthropic released an update regarding the project last week. The firm's latest AI model, Claude Opus 4.8, aims to deliver improved performance and new controls for customers and developers, the company announced this week. Photo Courtesy: Thrive Studios ID on Shutterstock.com Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.

Apollo, Blackstone work on $36 billion debt deal for Anthropic, Bloomberg News reports

May 28 (Reuters) - Apollo Global Management and Blackstone are working to bring in additional investors for about $36 billion debt financing tied to AI startup Anthropic PBC's efforts to expand its AI infrastructure, Bloomberg News reported on Thursday. The debt would be used to buy custom chips from Google. Anthropic would then lease these chips, known as tensor processing units, or TPUs, the report said, citing people familiar with the matter. Broadcom, which helps Google develop the chips, is backstopping payments on the largest portions of the transaction, the report added. Anthropic said on Thursday it had raised $65 billion at a $965 billion post-money valuation, surpassing rival OpenAI, as the AI startup looks to expand computing capacity to meet growing demand for its Claude chatbot. The Bloomberg report said that Apollo and Blackstone plan to sell down part of the debt while retaining significant portions themselves. Investors are being asked to submit orders this week, with the deal expected to close next week, the report said, adding that discussions are ongoing and the terms could still change. Anthropic and OpenAI are eyeing potential IPOs as early as this year. Apollo, Blackstone, Anthropic, Google and Broadcom did not immediately respond to Reuters' requests for comment. (Reporting by Prakhar Srivastava in Bengaluru; editing by Alan Barona)