In one of the biggest debt deals associated with the AI buildout, Bank of America, Blackstone, Citi, and Morgan Stanley will offer $63 billion in financing to purchase Broadcom’s AI chips and networking equipment for Anthropic.
By offering “residual value support” to lenders that are offering senior debt or first-lien loans, Broadcom is essentially offering a sizable guaranty in the financing structure.
The most recent agreement demonstrates the expanding importance of banks and alternative asset managers in funding the infrastructure required to meet the growing demand for AI processing power.
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On Monday, Anthropic filed for a possible record-breaking initial public offering (IPO), despite the possibility that investor enthusiasm for the AI heavyweight would be tested by revelations of sharp losses and security issues.
The first-lien loans or senior debt amount to roughly $43.5 billion, or 69% of the entire funding.
According to the announcement, Bank of America, Citigroup, and Morgan Stanley are organizing the first-lien financing, while Blackstone will supply the committed portion of the second-lien financing, which is ranked below senior debt.
In the past, chipmakers have promised to cover possible drops in the value of assets like data infrastructure and sophisticated chips.
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The split of the loans was not disclosed in the statement, and Broadcom did not reply to a request for comment.
Technology businesses are racing to secure capacity for increasingly complex workloads, driving significant investment in computing infrastructure as demand for AI grows.
The firms announced on Monday that the deal will be executed through a newly established special purpose organization that will buy Broadcom’s networking equipment and AI accelerators and lease them to the Claude maker.
Morgan Stanley, Citi, and Bank of America are arranging the first-lien financing.
As part of a previously announced strategic computing capacity arrangement including Broadcom, deliveries are anticipated to start in 2027, according to the firms.
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In a previous deal with Broadcom, Apollo and Blackstone had committed to funding a $35 billion increase in Anthropic’s AI processing capacity.
According to a document, Broadcom’s backup in that transaction was up to $29 billion.
Moody’s called Broadcom one of the most financially solid big tech firms but cautioned that its risk profile would worsen if it took on several deals in quick succession to cover the hefty capital demands of leading AI labs.
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