SpaceX $40 billion debt deal gets pricey as AI fears spread
Musk is trying to raise money to fund a massive expansion in chips, data centers.
SpaceX is finalizing a $40 billion debt raise at significantly higher interest rates, indicating growing unease in the AI sector. The least creditworthy portion of the debt is anticipated to carry interest rates of around 8.3%, according to individuals with knowledge of the deal, which is being spearheaded by Apollo and Goldman Sachs.
A safer segment of the debt, which is secured by some of SpaceX's chips, is expected to price next week at approximately 7.75%, the individuals said. This is more than 1 percentage point higher than where SpaceX's existing bonds are currently trading, reflecting a sharp contraction in the AI-loan market over the past few weeks. President Donald Trump acquired $5 million worth of SpaceX bonds in August.
However, both Goldman and Apollo were unresponsive to inquiries. The final pricing might fluctuate by the time the debt is completed, which is expected to occur sometime next week. SpaceX's current bonds, which are being evaluated for a potential merger with Tesla, have weakened in recent days as impressive earnings were overshadowed by gargantuan spending plans and apprehensions about the company's debt burden, coupled with broader AI fears stemming from CoreWeave's debt liquidation.
Additionally, default insurance on the company has widened, signaling some reservations regarding SpaceX's strategies.
Written by urgent.news from Semafor's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
