Apollo and Blackstone Said to Complete $35 Billion Private Credit Deal to Provide ‘Chip Financing’ for Anthropic’s Computing Power Expansion

TradingKey - On June 8, ET, according to the Financial Times, Apollo Global Management ( APO) and Blackstone Group ( BX) have finalized a $35 billion private credit financing arrangement aimed at supporting the computing power expansion of AI leader Anthropic. The funds will be used to purchase Google ( GOOGL) custom-developed Tensor Processing Units (TPUs) for Anthropic, which will be provided to the company via a lease arrangement.

This financing utilizes a Special Purpose Vehicle (SPV) structure. The SPV raises funds through a mix of debt and equity, purchases the chips, and then leases them to the client; debt repayment is primarily sourced from lease income, supported by the residual value of the chips. The $35 billion debt is divided into three tranches: a $6 billion Senior A1 tranche and a $24 billion A2 tranche, both of which are backed by Broadcom's ( AVGO) credit endorsement and residual value guarantees; the A1 tranche carries a coupon of Treasury rate + 100 basis points and is offered to banks, while the A2 tranche carries a 5.75% coupon and is priced at par. The third tranche, Class B notes totaling $4.5 billion, lacks Broadcom’s endorsement and carries an 8.5% coupon. Additionally, Apollo’s Atlas SP Partners contributed $800 million in equity capital to become the owner of the SPV.

The "residual value support" agreement provided by Broadcom is the core innovation of this transaction. If Anthropic fails to meet its lease payment obligations, the SPV will sell the chips to repay the debt; if the chip value is insufficient, Broadcom will provide 100% compensation for the shortfall to A1 and A2 tranche investors. This brings the credit ratings of the first two tranches close to Broadcom’s own investment-grade level without impacting Broadcom’s balance sheet.

Broadcom CEO Hock Tan stated during an earnings call that the company is collaborating with Apollo, Blackstone, and others to create the "AI XPV Platform," with a goal of deploying over 20 gigawatts of computing power by 2028. He noted: "Our strategic vision is to combine Broadcom's leading technology with the balance sheets of the strongest investment partners to provide sufficient computing power for frontier AI labs at the lowest cost and power consumption."

This financing comes amid Anthropic’s rapid expansion. The company secretly filed for a U.S. IPO on June 1 and completed a $65 billion Series H funding round last month, reaching a post-money valuation of $965 billion. Against the backdrop of a race with OpenAI to go public, this debt arrangement further solidifies the funding foundation for its infrastructure expansion.

This deal is one of the largest private credit transactions to date, marking a milestone stage for "chip financing." Analysts pointed out that tech companies are leveraging every door in the credit market to meet unprecedented capital demands, forcing Wall Street to continuously design new debt structures. As of press time, Apollo, Blackstone, and Anthropic have not responded.