Lambda closes US$926m GPU-backed term loan B at SOFR plus 300bp

AI cloud operator Lambda has closed a US$926m senior secured term loan backed by GPU infrastructure and the contracted cash flows generated by those assets, extending asset-backed financing further into the rapidly expanding AI data-centre market.

The term loan B will finance the purchase and deployment of GPUs for a committed customer arrangement with an investment-grade offtaker. Moody’s has assigned the facility a Baa2 rating, while the debt was priced at SOFR plus 300 basis points and issued at 99.5% of principal.

The financing matures on 31 December 2030 and amortises fully over its life. Repayment has been structured to align with the contracted customer cash flows and useful life of the underlying GPU infrastructure, while the security package includes the funded servers and related infrastructure together with the revenues those assets generate.

That makes the structure more significant than a conventional corporate loan. The debt sits against a discrete pool of income-producing physical assets and contracted demand, giving lenders a financing proposition based partly on asset value and identifiable future cash flow rather than relying solely on Lambda’s general corporate credit.

Morgan Stanley acted as lead left arranger, bookrunner and administrative agent. MUFG was joint bookrunner, with Citizens Bank, Crédit Agricole and Wells Fargo acting as documentation agents.

The facility was first priced on 12 August, so the pricing itself is not new. The 27 August development is the closing of the US$926m transaction. That distinction also separates it from BCR’s earlier broader coverage of the emerging chip-backed financing market. Lambda has now moved from pricing to an executed, investment-grade-rated financing against specific GPU assets and committed customer cash flow.

It is the company’s second major debt financing this year, following a US$1bn senior secured credit facility announced in May. Lambda said it expects to continue using asset-backed structures as it adds GPU capacity against multi-year customer commitments.

The financing provides a concrete example of expensive computing hardware being treated increasingly like other contracted infrastructure assets, with asset security, customer credit quality and cash-flow duration combining to support large-scale private debt.