Nvidia backs a $3.1 billion loan for an Indonesian AI infrastructure platform
Nvidia just backed a massive $3.1 billion loan deal.
The short version
- The money buys advanced chips for a new AI factory in Asia.
- Citigroup and other global banks underwrote the massive financing package.
- Smaller businesses will soon get easier access to computing power.
Why it matters to you. For business owners watching the global AI hardware boom, chip financing is no longer just for the largest technology giants.
Zankore, an Indonesian AI infrastructure platform backed by Nvidia, the chip designer whose processors power the artificial intelligence boom, just signed a $3.1 billion loan deal to buy advanced computer chips. The massive financing underscores the surging demand for computing capacity across Asia.
Citigroup, the giant New York-based bank, joined ING, Natixis, Qatar National Bank, and United Overseas Bank to underwrite the loan, marking one of Asia's largest AI infrastructure deals. Citigroup also served as the sole debt adviser on the transaction.
The proceeds will acquire and deploy advanced Nvidia graphics processing units in Zankore's new AI factory. The facility will launch with an initial capacity of 100 megawatts, enough power for about 40,000 homes, before expanding to one gigawatt.
Financing hardware like graphics processing units is emerging as the next big frontier for lenders as banks and private credit expand beyond traditional data centres. Bank-led deals have been scarce in Asia due to uncertainty over the resale value of chips and geopolitical risks amid the United States-China technology rivalry.
To overcome those hurdles, Zankore's financing carries a unique revenue-sharing and credit-support model directly from Nvidia, easing lenders' concerns over repayment and credit risk.
"Nvidia is helping us to make it financeable," Vikram Sinha, the chairman of Zankore, said in an interview according to Bloomberg. Nvidia's service order will ensure that the computing capacity extends beyond investment-grade customers to small enterprises needing compute on demand.
Nvidia launched the model in July to help its partners broaden access to data center infrastructure and provide financial support for smaller players. Zankore's shareholders also include Indosat Ooredoo Hutchison, Indonesia's second-largest mobile carrier, Ooredoo Group, and Nokia, the Finnish telecommunications equipment maker.
Photo: Coolcaesar, CC BY-SA 4.0, via Wikimedia Commons
