Investors have been pushing for fatter payouts on riskier AI debt, so JPMorgan and Goldman structured Volta's financing to limit what they could be stuck holding. They agreed to underwrite the $1.3 billion term loan while leaving the $3.7 billion chip financing outside of their backstop. People familiar with the arrangement described the approach, and representatives for the banks and Volta declined to comment.
The package splits into two parts: a $1.3 billion term loan and a $3.7 billion facility tied to chips. Bloomberg has reported that the term loan will go toward lease payments to Bitdeer for use of the facility, while the chip loan would fund roughly 36,000 Nvidia GPUs. The overall financing supports a data center project in Norway that Volta will run with Bitdeer Technologies Group. Bloomberg also previously reported, citing people familiar, that Anthropic PBC has locked in a six-year compute contract at the site.
When lead banks reduce exposure, they are telling you something about the deal. Market Briefs covers leveraged finance free every morning.
Volta's loans are being pitched to yield around 11%, placing them near the top end of pricing for AI-related leveraged loans. The package is unrated, which typically keeps collateralized loan obligations - the biggest buyers in this market - on the sidelines. Banks usually promise to finance entire packages so borrowers know the money is there even if demand wobbles, but that leaves lenders exposed if prices slip or the paper fails to move.
Memories of 2022, when rapid rate hikes froze markets and left banks with mark-to-market pain on unsold debt, still loom large. With AI deals, especially for newer names, lenders have been leaning on less traditional structures to avoid getting trapped again.
Volta is part of the "neocloud" crowd that rents computing horsepower and related AI gear. Earlier this year, Ricard Boada and Sofia Gumuzio launched the company after stints in Brookfield Asset Management's infrastructure unit. Their aim is to help leading labs and scrappy startups finance Nvidia's top-tier chips.
Wall Street has embraced similar plays from CoreWeave, Lambda and Crusoe, particularly for chip financing, though those deals cleared at lower borrowing costs than Volta's. JPMorgan started gauging investor interest back in August, and commitments for Volta's debt are due October 14. For anyone watching their own budget, the takeaway is simple: even in the AI rush, the more experimental the structure, the more a lender will charge to fund it.
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