JPMorgan, Japan’s MUFG Near $22 Billion Financing Deal For Data Center In Texas: Report

JPMorgan Chase & Co. (JPM) and Japan’s Mitsubishi UFJ Financial Group Inc. (MUFG) are reportedly in talks to underwrite a $22 billion financing deal for a new data center in Texas.

According to a report by The Financial Times, the deal involves a Vantage Data Centers facility, which is owned by Silver Lake and DigitalBridge Group Inc. (DBRG).

JPMorgan’s shares traded 0.23% lower in Wednesday’s morning session, while DigitalBridge’s shares were up 1.44%. Retail sentiment on Stocktwits around JPMorgan was in the ‘bullish’ territory, while users felt ‘bearish’ about DigitalBridge.

Vantage’s data center facility in Texas requires an investment of $25 billion. As part of the deal, JPMorgan and MUFG will reportedly underwrite $22 billion, while Silver Lake and DigitalBridge will commit $3 billion in combined equity.

The $22 billion financing from JPMorgan and MUFG comes after Meta Platforms Inc. (META) reportedly tapped Pacific Investment Management Co. (PIMCO) and Blue Owl Capital to lead a $29 billion financing for its data center expansion project in rural Louisiana.

Last week, OpenAI co-founder Sam Altman warned about an AI bubble. “When bubbles happen, smart people get overexcited about a kernel of truth,” said Altman, according to a report by The Verge.

UBS strategists have also warned that the artificial intelligence boom led by investments from private credit firms and lenders is increasing the risk of overheating in the sector. The firm cautioned that private credit has grown beyond lending to small companies to tech giants–the technology sector’s debt from private lenders rose by nearly 29% or $100 billion in the last 12 months.

JPM stock is up 21% year-to-date, while DBRG stock is down 1%.

Also See: Dow Futures Edge Lower As Investors Await Fed Minutes: TGT, PLTR, TOL, LOW Among Stocks To Watch

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