Anthropic faces higher borrowing risk after Blackstone flags junk rating post-IPO

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Anthropic faces borrowing risk post-ipo

Highlights

Blackstone told investors Anthropic is now expected to receive a high junk rating, likely in the double B range, after its IPO despite previous investment-grade guidance.
Anthropic's planned $800 billion spend on computing infrastructure through 2045 depends on lower-cost debt, but a junk rating could restrict access to insurance and pension fund capital.
In the $63 billion Project North Star financing, Broadcom's guarantees support $42 billion of senior loans while Blackstone funds invested $9 billion in junior debt yielding over 10% and rated double B plus by KBRA.

Credit outlook shifts as IPO nears

As first reported by Financial Times, Blackstone has told investors in Anthropic's latest $63 billion chip financing deal that the AI start-up is expected to receive a high junk rating from major credit rating agencies after its initial public offering, according to people familiar with the matter.

That marks a change from Blackstone's earlier guidance to investment partners in recent months that Anthropic was expected to obtain an investment-grade rating before year-end. People familiar with the discussions say Blackstone has more recently indicated that a double B range rating or better is now more likely, based on feedback it has received from major credit agencies.

Anthropic filed to go public on Monday, setting up a listing that could become the largest of all time next month. Its prospectus outlines plans to spend more than $800 billion on computing infrastructure between now and 2045, making lower-cost access to debt markets an important part of its long-term financing strategy.

Financing implications for AI infrastructure

An investment-grade rating is central to that plan because it would allow Anthropic to borrow at lower rates for large infrastructure projects. Without it, the company may face limits in tapping insurance and pension fund capital, since many of those investors are restricted from taking large positions in junk-rated borrowers.

Anthropic has more than $112 billion in cash and equivalents, and investors expect it could raise about $100 billion more in the IPO. Even so, a non-investment-grade label could leave the company more reliant on highly rated suppliers to support future debt issuance.

Earlier this week, Wall Street banks closed the $63 billion Project North Star financing, which funds Anthropic's lease of 1.5 gigawatts of Google's semiconductors. More than $42 billion of the senior loans is guaranteed by Broadcom, which co-develops the chips and holds an investment-grade rating, while $18 billion of junior debt is backed by the AI start-up's lease payments.

Blackstone funds invested $9 billion in that junior debt at a yield of more than 10%. The junior portion of Project North Star has received a double B plus rating with a positive outlook from Kroll Bond Rating Agency, an improvement from the stable outlook assigned in a similar Project Big Sky deal four months ago, and a double B rating from Morningstar DBRS.

Fitch, Moody's and S&P, the three agencies with the greatest influence on borrowing costs, have not officially issued ratings for Anthropic. Anthropic, Blackstone, KBRA, Morningstar DBRS and S&P declined to comment, while Fitch and Moody's did not respond to requests for comment.

The financial strain on the U.S. AI data center boom has been building as higher borrowing costs, construction delays, and power constraints make many planned projects look increasingly hard to deliver. In our earlier coverage, we noted that only a minority of proposed data center developments were viewed as truly credible, with setbacks and cost overruns already testing investor confidence and access to capital.

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