Key facts
- Broadcom is negotiating to secure over $60 billion in debt financing for an AI chip initiative.
- The deal involves a potential $30 billion junior debt tranche and Broadcom guaranteeing a senior-secured tranche.
- The total financing could amount to as much as $100 billion.
- Blackstone and Apollo Global Management are in discussions to join the financing.
- Bank of America has flagged a potential $370 billion exposure for Broadcom's AI financing platform at full scale.
Broadcom is reportedly in discussions with lenders to secure over $60 billion in debt financing for an AI chip initiative, a deal that would also benefit companies like Anthropic. The financing could comprise a junior debt tranche of approximately $30 billion, with Broadcom potentially guaranteeing a senior-secured tranche ranging from $60 billion to $70 billion, potentially bringing the total raise to as much as $100 billion.
Blackstone and Apollo Global Management are reportedly in talks with Broadcom to participate in this financing, building on a partnership established in June. This move comes as Bank of America analysts have raised concerns about the potential exposure of Broadcom's AI financing platform, the AI XPV Platform, which is designed to reach over 20 gigawatts of compute capacity by 2028. While the initial transaction has a loss cap of $29 billion for Broadcom, a worst-case scenario at full platform scaling could involve an exposure of approximately $42 billion, with a modeled ceiling of $370 billion.