Wall Street banks, Blackstone line up $63 billion to finance Broadcom AI chips for Anthropic

Oct 26 : Bank of America, Blackstone, Citi and Morgan Stanley will provide $63 billion in financing to buy Broadcom's AI chips and networking gear for Anthropic, in one of the largest debt deals tied to the AI buildout.

Broadcom is providing "residual value support" to lenders, who are providing first lien loans or senior debt, effectively providing a significant guarantee in the financing structure.

The latest deal highlights the growing role of banks and alternative asset managers in financing the infrastructure needed to support rising demand for AI computing capacity.

Anthropic filed for a potentially record-breaking IPO on Monday, even as disclosures of steep losses and security concerns threatened to test investor appetite for the AI heavyweight.

The size of the first lien loans or senior debt is about $43.5 billion, according to two sources familiar with the matter, or 69 per cent of total financing.

Blackstone will provide the committed portion of the second-lien financing - which ranks below senior debt - while Bank of America, Citigroup and Morgan Stanley are arranging the first-lien financing, the statement said.

Chipmakers have provided guarantees in the past to absorb potential declines in the value of the assets, such as advanced chips and data infrastructure.

The release did not disclose the breakdown of the loans, while Broadcom did not respond to a request for comment.

Rising AI demand is driving massive investment in computing infrastructure as technology companies race to secure capacity for increasingly complex workloads.

The transaction will be carried out through a newly formed special purpose vehicle that will purchase Broadcom's AI accelerators and networking equipment and lease them to the Claude maker, the companies said on Monday.

Bank of America, Citi and Morgan Stanley are arranging the first-lien financing. 

Deliveries are expected to begin in 2027 as part of a previously announced strategic compute capacity agreement involving Broadcom, the companies said.

Apollo and Blackstone had agreed to finance a $35 billion expansion of Anthropic's AI computing capacity under a prior agreement with Broadcom. Broadcom's backstop in that deal was up to $29 billion, it said in a filing.

While Moody's described Broadcom as one of the strongest large technology companies, it warned that the risk would increase if multiple transactions were undertaken over a short period to meet the sizable funding needs of frontier AI labs.