Anthropic is reportedly offering Blackstone a yield above 10% to anchor $9 billion of junior debt for its latest AI chip deal, showing how costly computing power has become.
Key Points:
- Blackstone funds would invest $9 billion in debt backed by five-year chip lease payments.
- Borrowers with a similar rating typically pay about 7% in public bond markets.
- The package, called Project North Star, would be the largest chip financing to date.
Anthropic Chip Debt Terms
Blackstone-managed funds would take half of an $18 billion junior tranche backed by the AI developer's five-year lease payments on the chips, people familiar with the matter said. The firm was offered a 10% coupon, and issuance discounts and fees would push its total return above that level. Blackstone declined to comment, and Anthropic did not immediately respond.
Called Project North Star, the package would pay for about 1.5 gigawatts of Google tensor processing units held in a special-purpose vehicle and leased to Anthropic. It also includes about $42 billion of senior debt guaranteed by Broadcom, while the other $9 billion of junior debt may go to other investors in coming months, possibly at lower yields.
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Blackstone Yield Premium
The pricing stands out because borrowers with a similar credit rating typically pay about 7% in public bond markets. KBRA rated Anthropic one notch below investment grade in June. The company wants an upgrade that could make future borrowing much cheaper.
Costs have climbed quickly, since Anthropic paid 8.5% on roughly $4.4 billion raised through a similar deal, called Project Big Sky, about four months ago.
The package would be the largest chip financing on record, testing how much AI debt investors will take on amid worries about rising infrastructure spending.
Robert Leitao, a managing partner at Rothschild & Co, has warned of "quite a concentrated bet" on two companies earning enough to support all this financing. The debt could trade among institutional buyers once it is drawn in 2027.
Anthropic Financing Spree
The talks build on a June deal in which Apollo led a $35 billion package with Blackstone to fund more than 1 gigawatt of Anthropic compute at Fluidstack-based sites. It launched a Broadcom platform meant to back over 20 gigawatts by 2028.
In early October, Bank of America, Citigroup and Morgan Stanley began syndicating the $42 billion senior slice of the new package.
Anthropic's IPO filing shows the company has committed $125.2 billion under a five-year lease for tensor processing unit capacity. It plans to go public later this year.
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