Nvidia is reportedly in talks to guarantee billions in debt financing for Nscale’s planned Anthropic data center in West Virginia. The proposed arrangement, known as a residual value guarantee, would require Nvidia to step in if Nscale defaulted on construction payments, temporarily taking over the facility and assisting in finding a buyer and new tenant, according to The Information. Anthropic has signed a $44.6 billion contract for the project’s first building alone, according to Nscale’s IPO filing, and the companies are also discussing a second deal valued at roughly $45 billion for an additional building.
The stakes are significant for Nscale, which seeks to go public with a valuation of up to $35 billion despite investor concerns regarding its ability to execute ambitious data center projects. Nvidia has previously provided support to cloud providers, primarily covering leases and chip purchases, rather than construction financing.
Nvidia has been a major financial backer in the sector, extending approximately $170 billion in investments and credit support to neoclouds and large customers, which includes a $1 billion convertible financing commitment to Nscale in September. The discussions surrounding the guarantee would deepen Nvidia’s financial ties to Nscale while simultaneously helping to secure a major customer for its chips.
Anthropic, one of the largest purchasers of AI computing power, has diversified its infrastructure spending across multiple chipmakers. The talks come as Anthropic itself faces questions regarding the financing of its rapid expansion; the company filed to go public this week, but Blackstone warned investors that Anthropic could receive a below-investment-grade credit rating following its IPO, which would increase its borrowing costs.
Nscale’s West Virginia campus has faced operational issues, including runoff from the construction site flooding nearby homes on multiple occasions. While the project secured state certification in September after months of negotiations, Microsoft recently withdrew from a planned Nscale site in England because the grid power for that location was projected for the 2030s.
