Sources indicate that Apollo Global Management (APO) is in talks to lead a $35 billion financing package for Meta Platforms (META, Financial) to develop data centers in the U.S. Apollo is reportedly considering providing a significant portion of this funding. However, discussions are still in the early stages, and there is no guarantee that a deal will be finalized.
In January, Meta CEO Mark Zuckerberg announced plans to invest up to $65 billion this year to expand AI infrastructure. This includes constructing a new data center and expanding AI team recruitment. Meta aims to achieve 1 GW of online computing capacity by 2025. The company has already committed $10 billion to build a data center in Louisiana and has purchased new computer chips to power some of its products. Zuckerberg also mentioned that Meta's investments in AI infrastructure could eventually reach hundreds of billions of dollars.
Meanwhile, Microsoft (MSFT) plans to invest $80 billion in data centers this fiscal year. CEO Satya Nadella emphasized the need to maintain spending to meet "exponentially growing demand." Building AI infrastructure is estimated to require hundreds of billions of dollars. Over the past year, bankers and investors have been eager to capitalize on the AI spending surge as the stock market rewards companies critical to the AI ecosystem.
Alternative asset management firms have previously collaborated with tech giants, but the potential deal with Meta is particularly noteworthy. AI data analytics company Databricks previously secured over $5 billion in debt financing from lenders including Blackstone, Apollo, and Blue Owl Capital, marking its largest debt financing to date. Last year, Apollo acquired Intel's (INTC) stake in an Irish joint venture for $11 billion.
