Oracle and others are borrowing another $38 billion, and the total debt of the "OpenAI Chain" data center circle has reached $100 billion!

To support OpenAI’s grand blueprint, a vast ecosystem formed by its partners is financing the AI infrastructure construction boom through debt, while OpenAI itself cleverly keeps the financial risks off its own books.

The latest development is that a new round of massive financing for OpenAI’s infrastructure is brewing. According to sources, a banking consortium is negotiating a new loan of up to $38 billion, expected to close in the coming weeks. The funds will be used by Oracle and data center builder Vantage to construct new sites for OpenAI.

This new loan will be yet another heavy burden on the network of debts. Analysts say partners such as SoftBank, Oracle, and CoreWeave have previously borrowed at least $30 billion either to invest in OpenAI or help it build data centers. Additionally, investment groups like Blue Owl Capital and computing infrastructure company Crusoe rely on agreements with OpenAI to repay about $28 billion in loans.

However, amid this high-stakes gamble, OpenAI’s own balance sheet remains remarkably “clean.” According to people close to the company, OpenAI carries almost no debt and only secured a $4 billion credit line last year which has yet to be used. The strategic intent is clear—an OpenAI executive candidly admits:

“How does (OpenAI) leverage other people’s balance sheets? That’s always been our strategy.”

Debt Approaches $100 Billion, Partners Bear Financial Risk

With the addition of the new $38 billion loan, total debt surrounding OpenAI is approaching the $100 billion mark. This scale is comparable to that of the world’s biggest corporate borrowers. According to a report by Janus Henderson in 2024, this figure is equivalent to the combined net debt of the six largest global corporate borrowers, including Volkswagen, Toyota, AT&T and Comcast.

In fact, the actual debt associated with OpenAI may be much higher. Many partners, including SoftBank and CoreWeave, have raised even larger amounts this year, though not all are directly tied to OpenAI. For example, SoftBank raised about $20 billion this year for AI investments, with OpenAI its largest target so far.

Meanwhile, as the ultimate beneficiary, OpenAI has successfully shifted the risk. The world’s most valuable private company (recently valued at $500 billion) firmly believes that, to achieve superhuman “artificial general intelligence” (AGI), more capital is needed to support the construction of data centers, chips, and power.

Procurement Commitments Far Exceed Revenue, Financing Pressure Skillfully Shifted

OpenAI is able to persuade partners to shoulder huge debt thanks to its near limitless demand for computing power. This startup has signed agreements to procure $1.4 trillion worth of computing capacity over the next eight years, a figure far exceeding its projected annualized revenue of $20 billion this year.

For partners, these large long-term procurement contracts form the credit basis for raising bank debt. For OpenAI, it’s an effective expansion model. OpenAI stated:

“Building AI infrastructure is the most important thing we can do to meet surging global demand… The current shortage of computing power is the single biggest constraint on OpenAI’s growth.”

Oracle has already sold $18 billion in corporate bonds to fulfill infrastructure commitments to OpenAI. Analysts at KeyBanc Capital Markets forecast that the tech group led by Larry Ellison may need to borrow $100 billion over the next four years to fully deliver on its contracts with OpenAI.

SPVs and Non-Recourse Loans: Sophisticated Mechanisms for Risk Isolation

In this wave of debt expansion, complex financial instruments play a key role in helping investors and developers isolate risk. Many data center loans are made via special purpose vehicles (SPVs), structures that, in case of default, protect the parent companies of investors and developers from impact.

Sources familiar with the negotiations revealed that Vantage is preparing to use SPV structures for loans on new sites in Texas and Wisconsin. Previously, Blue Owl and Crusoe set up a joint SPV for OpenAI’s first U.S. data center in Abilene, Texas, which received about $10 billion in loans from JPMorgan. The loan was non-recourse, meaning if Oracle (the lessee) defaulted, JPMorgan would take over the land and data center, but could not claim against Blue Owl or Crusoe.

Similarly, Blue Owl used a wholly-owned SPV to borrow $18 billion from a consortium mostly comprised of Japanese banks for a new data center in New Mexico, also leased by Oracle for OpenAI. These sophisticated financing arrangements ensure that even if a project runs into trouble, risk is confined to the specific project, encouraging continued capital inflow to the construction boom surrounding OpenAI.

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