Meta, Blue Owl Seal $30 Billion Private Capital Deal for AI

Core Insights - Meta Platforms Inc. is finalizing a nearly $30 billion financing package for a data center in Louisiana, marking the largest private capital deal on record [1] Financing Structure - Blue Owl Capital Inc. and Meta will co-own the Hyperion data center, with Meta retaining only 20% ownership [2] - Morgan Stanley arranged over $27 billion in debt and approximately $2.5 billion in equity through a special purpose vehicle (SPV) [2][4] - The SPV structure allows Meta to avoid directly borrowing capital, as the financing entity will handle the debt [4] Market Context - The financing serves as a model for other hyperscalers aiming to develop large data centers while maintaining their credit ratings [3] - Tech companies in the U.S. bond markets raised about $157 billion through late September, a 70% increase from the previous year [3] Investment Trends - The SPV structure is gaining popularity as it allows tech companies to avoid heavy debt on their balance sheets while providing investors with asset-backed investment opportunities [5] - Similar financing structures are being pursued by other firms, such as Elon Musk's xAI, which is raising $20 billion by renting chips instead of owning them outright [5]