- Pimco discusses US billion debt package for Oracle’s Michigan data centre project
- Financial lenders compete to fund AI infrastructure as capital needs surge
What happened
Talks centre on financing a Michigan data centre as Oracle ramps up AI infrastructure and broader capital-raising plans.
Pimco, one of the world’s largest asset managers, is in discussions with Bank of America to arrange roughly US billion in debt financing for an Oracle data centre in Saline Township, Michigan. If completed, the deal would make Pimco a key financial backer of the project.
The financing could be structured as a bond—potentially under Rule 144A—allowing it to be privately placed with large institutional investors rather than issued through traditional syndicated loans.
The project is part of Oracle’s broader push into artificial intelligence infrastructure. The company said earlier this year it plans to raise up to US billion through a mix of debt and equity to fund expansion.
Separately, data centre developer Related Digital is reportedly close to securing a US billion financing package for the same Michigan campus, underscoring the scale of capital required.
Oracle has said development at the site is progressing “on time and according to plan”, even as investors scrutinise the company’s rising debt levels linked to its AI build-out.
Why it’s important
The deal signals AI computing is shifting into a finance-led, asset-heavy expansion cycle where capital access becomes a key competitive edge.
The scale and structure of the proposed financing underline a deeper industry transition: AI infrastructure is no longer purely a technology race, but a capital-intensive contest shaped by financial capacity. As data centres evolve into long-duration, asset-heavy investments, private credit and bond markets are increasingly stepping in to fund growth at a scale traditional banks may struggle to match.
Over time, this could reshape ownership models of digital infrastructure, with closer alignment between technology companies and financial institutions. It also raises questions about leverage, long-term returns and systemic exposure, as AI-driven demand continues to push data centre investment into ever larger, more capital-intensive territory.
Also read: Oracle plans job cuts as data centre spending accelerates
Also read: Oracle and OpenAI Halt Plans to Expand Flagship AI Data Centre
