Apollo nears $3.4B loan tied to NVIDIA chip leasing for xAI
Apollo Global Management is close to finalising a $3.4 billion loan to an investment vehicle that plans to purchase NVIDIA chips and lease them to xAI, according to industry reports. The financing could be completed as early as this week and is being arranged by Valor Equity Partners, a long-time backer of businesses associated with Elon Musk.
Apollo declined to comment on the reported deal. xAI, NVIDIA, and SpaceX did not respond to requests for comment.
Chip leasing model expands as AI compute demand surges
The structure reflects a broader trend in AI infrastructure finance: leasing high-end chips rather than buying them outright can help AI companies scale compute capacity quickly without tying up large amounts of capital in hardware. The approach is gaining attention as major technology firms are expected to spend more than $600 billion this year on advanced chips and data centres to support AI development.
Financing follows SpaceX–xAI combination announcement
The reported loan comes shortly after Musk announced a deal combining SpaceX and xAI, valuing SpaceX at $1 trillion and xAI at $250 billion. The combination is intended to accelerate work on orbital data centres, which could use space-based infrastructure to support future AI computing needs.
A second major Apollo-linked chip leasing push for xAI
This would mark Apollo’s second major investment tied to chip leasing for xAI. In November, Apollo-backed funds provided a $3.5 billion loan for a similar structure supporting a large AI compute cluster. That earlier financing was also arranged by Valor Equity Partners and included NVIDIA as a key investor in the vehicle.
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