Oracle data center secures $16 billion financing after months of Wall Street negotiations

Oracle Data Center Financing Closes After Extended Negotiations

A $16 billion financing package for a giant Oracle data center in Michigan has finally closed after months of protracted negotiations with investors, marking one of the largest infrastructure deals in the AI boom 1

1

. Related Digital, the data center developer behind the project, announced Friday that it secured the funding for the campus in Saline Township, southeastern Michigan 2

2

.

The financing includes equity from Related Digital and funds affiliated with Blackstone, which contributed approximately $2 billion, along with fixed-rate, long-term debt financing anchored by PIMCO-managed funds and accounts 1

1

3

3

. Bank of America sold $14 billion of bonds tied to the project, with Pimco purchasing about $10 billion of the debt that priced Friday, while other investors bought the remainder 1

1

.

Debt Package Structure Reflects Market Caution

The bonds were sold privately in a 144A offering, restricting purchases to large institutional investors. The notes mature in 2045, were priced at 98.75 cents on the dollar, and carry a 7.5% coupon 1

1

. The stop-and-start nature of these negotiations reveals how Big Tech's debt-fueled AI expansion is running into more intense scrutiny from Wall Street, as investors weigh the risks of massive infrastructure bets against uncertain returns 1

1

.

This debt deal follows other massive financing packages that banks assembled for Oracle: a $38 billion debt deal to build facilities in Texas and Wisconsin, and $18 billion for a New Mexico site. Since last year, at least $290 billion of debt financing has been arranged for hyperscaler projects as debt markets fuel the artificial intelligence infrastructure buildout 1

1

.

Expanding AI Infrastructure Capacity for OpenAI Partnership

Oracle is the tenant for the data center campus in Michigan and aims to use the facility to power applications for OpenAI 1

1

. OpenAI, Oracle and Related Digital announced the project in October as part of their push to expand U.S. AI infrastructure capacity 2

2

. The Saline Township campus will include three single-story data center buildings with more than a gigawatt of compute capacity 1

1

.

DTE Energy is supplying power to the project, while Oracle is financing a new battery storage investment to support operations 1

1

. Related Digital, a venture of New York-based property developer Related Cos., said the project will play a critical role in America's digital future 1

1

. Oracle has become one of the largest high-grade corporate bond issuers in the US, with about $120 billion of notes in the main US corporate bond index, and sold $25 billion of bonds in early February 1

1

.