Nscale taps lenders for $900m to fuel AI data centre splurge
British data centre builder Nscale has landed a $900m (£673m) credit line from some of Wall Street’s biggest banks to fuel its global expansion, even as investors increasingly scrutinise the sector’s breakneck spending.
The London-headquartered company said the financing will support the construction of new AI data centres across Europe, the US and Asia-Pacific as demand for its computing power continues to surge.
The revolving credit facility, which has been provided by 12 banks including J.P. Morgan, Goldman Sachs and Morgan Stanley, adds to a major run of fundraising for the company in the past seven months. Nscale raised $2bn at a $14.6bn valuation earlier this year before securing a further $790m to develop its AI data centre in Norway.
Unlike a conventional loan, the revolving credit facility allows the company to draw down funds as projects require and repay them over time, giving the company liquidity without issuing new equity or immediately taking on the full $900m in debt.
The company has rapidly emerged as one of Europe’s biggest bets on AI infrastructure, backed by the likes of Nvidia, Dell and Nokia.
“The closing of this revolving credit facility with key global investment banks reflects real institutional confidence in our platform, capital structure and team,” chief executive Josh Payne said.
“We are building the infrastructure that the world’s largest technology companies depend on to train, deploy and scale AI, and this facility increases our flexibility to do that at speed and at scale.”
Goldman Sachs declined to comment. The other banks did not respond to requests for comment.
Banks keep faith despite AI spending doubts
Tech firms have committed tens of billions of dollars to new data centres, chips and energy supplies over the past two years, prompting warnings from some investors that the industry risks overbuilding if enterprise adoption fails to keep pace.
Mark Boost, chief executive of cloud provider Civo, said the deal illustrated “the massive scale of capital currently fuelling the AI infrastructure boom”, but warned the industry’s long-term success would depend on turning infrastructure investment into sustainable commercial demand.
“As it stands, much of the industry is reliant on the assumption that hyperscale AI demand will continue to increase indefinitely,” he said.
“For this rapid liquidity to be justified, the market must recognise what enterprises actually need to survive. This means cost-effective, portable and sovereign AI solutions, as opposed to simply feeding a speculative hyperscaler arms race.”
Nscale rejected suggestions it was pursuing speculative expansion, saying it builds infrastructure only where long-term customer contracts are already in place.
The company said the financing provides flexible access to capital that can be drawn down as projects require, rather than representing money that will necessarily be spent immediately.