BlackRock to Sell Over $12 Billion in Bonds for Texas Data Center Project with Meta

BlackRock Inc. plans to raise more than $12 billion through a bond sale to finance the construction of a data center campus in El Paso, Texas, according to a Bloomberg News report. The significant debt offering highlights the massive capital investments required to build the infrastructure supporting the artificial intelligence boom.

Details of the Offering

The financing will be managed by JPMorgan Chase & Co. and Morgan Stanley, who are set to organize calls with fixed-income investors this week. The bonds are expected to be priced early next week.

According to the report, the total size of the financing could ultimately reach approximately $13 billion. The deal represents one of the largest financing packages for the rapidly expanding data center sector, which is critical for powering AI and cloud computing services.

Project Structure and Ownership

The bonds will be issued by a company holding an 80% stake in the data center venture, known as Project Sopaipilla Holdings. This controlling stake is held by funds managed by Global Infrastructure Partners (GIP) and HPS Investment Partners, both of which are units of BlackRock.

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Meta Platforms Inc., the parent company of Facebook, owns the remaining 20% of the project. This structure allows the technology giant to partner with infrastructure investors to fund the capital-intensive development of its data center footprint.

Context: Funding the AI Boom

This transaction is the latest example of creative financing solutions being used to fund the AI arms race. It follows a similar structure to a nearly $30 billion financing package that Meta and Blue Owl Capital Inc. completed last year for a data center site in rural Louisiana.

As technology companies race to expand their AI capabilities, the demand for specialized data centers is surging. These large-scale debt offerings allow institutional investors to gain exposure to the growth of digital infrastructure while providing technology firms with the necessary capital to expand.