Meta Raised $27 Billion for an AI Data Center. Who’s Backing the Deal.

Meta Platforms plans for its Hyperion data center to eventually have five gigawatts worth of capacity. (Courtesy Meta)

Key Points

• Meta Platforms and its partner secured $27 billion in private debt to fund the construction of the Hyperion data center.
• Pimco purchased approximately $18 billion and BlackRock bought over $3 billion of the bonds for the Hyperion project.
• Meta’s Hyperion data center, 80% owned by Blue Owl Capital, is expected to provide five gigawatts of power by 2030.

Meta Platforms and its partner raised $27 billion in private debt to fund the construction of its Hyperion data center in Louisiana. Some of the world’s biggest financial institutions are backing the deal.

Bond manager Pimco was the biggest buyer, accounting for around $18 billion, while asset manager BlackRock bought more than $3 billion of bonds, The Wall Street Journal reported late Tuesday, citing people familiar with the matter.

The Hyperion project is 80%-owned by private-credit manager Blue Owl Capital , while Meta, Facebook’s parent, owns the remaining 20% stake. Blue Owl contributed around $7 billion in cash while Meta received a one-time payout of $3 billion.

By issuing the debt through a joint venture, Meta financed the deal off its balance sheet, the Journal reported.

Hyperion is expected to eventually have capacity requiring five gigawatts of power, but it will take until 2030 to reach an initial two gigawatts. Meta CEO Mark Zuckerberg said last month that it was “quite possible” his company could invest more than a planned $600 billion in the U.S. through 2028 if AI progress keeps accelerating, in a post on the company’s social-media platform Threads.

Apart from huge spending on infrastructure, Meta has hired dozens of AI researchers from Microsoft-backed OpenAI, Amazon.com-backed Anthropic, and Alphabet ‘s Google DeepMind, offering pay of up to $100 million, according to OpenAI CEO Altman.

That hiring now looks to potentially be slowing as Meta reshapes its AI team around its new “Superintelligence Labs” unit, led by former Scale AI CEO Alexandr Wang. Meta is cutting around 600 AI jobs out of a total of several thousand employees in the unit, Axios reported on Wednesday, citing a company memo.

Meta didn’t immediately respond to a request for comment. Shares were down 0.1% in early trading, while the S&P 500 was 0.3% lower.

Write to Adam Clark at adam.clark@barrons.com