Carl Quintanilla (Anchor) 00:00.070
an oracle 's AI ambitions on the heels of this new report now on the fate of a data center in michigan for that will turn to seema modi important story seema it
Seema Mody (Business News Reporter) 00:08.670
is called they're having these questions surrounding oracles one gigawatt data center in michigan and who will finance this ten billion dollar project following an FT report that suggests talks are breaking down oracle telling CNBC that the FD story is incorrect and that its
Seema Mody (Business News Reporter) 00:22.550
developments partner related digital selected the best equity partner from a competitive group of options which in this instance was not owl and that final negotiations are moving forward now i'm told by a source familiar that blue owl decided to not pursue this data center that
Seema Mody (Business News Reporter) 00:38.190
oracle is developing for its main customer open AI due to unfavorable debt terms involving the structure of repayments and that through their due diligence process it was found that local issues in michigan too would add to some delays of that project now blue owl is still
Seema Mody (Business News Reporter) 00:53.070
involved with two other oracle data centers the details of this specific michigan deal guys comes as the market is growing more concerned with the capital intensive nature of developing these data centers tied to also oracle 's increased use of debt to fund these projects the
Seema Mody (Business News Reporter) 01:07.750
movement and its credit default swaps which of course has raised another set of questions around credit so my sense is that these projects are moving forward the details tied to each deal that are just being scrutinized more so than perhaps six to eight months ago so
David Faber (Anchor) 01:21.230
seema it seems as though based on your reporting blue owl made a credit decision and and again you refer to the equity i mean in these deals there's the equity and then there's as well the debt that goes on top of it can you clarify at all what we're talking about here
Seema Mody (Business News Reporter) 01:37.430
yeah my sense is that one of the reasons blue owl did not pursue this ten billion dollar project that oracle is trying to develop in michigan is due to the debt terms of this deal and not so much the equity more about the debt story and also just the repayment structure of the
Seema Mody (Business News Reporter) 01:52.830
debt that would be required to to develop and finance the specific but again i think it just comes as more investors evaluate these deals they're just becoming much more critical david of the nuances and granularity of these deals than perhaps earlier this year when it was like
Seema Mody (Business News Reporter) 02:06.670
let's just get in this is going to be a big long-term bet and it's going to pay off but as we debate the return on investment investors too are becoming a bit more critical right but
David Faber (Anchor) 02:15.390
it doesn't appear as though the deal itself or i should say the the the project itself is on hold in any way that's what
Seema Mody (Business News Reporter) 02:21.510
the company is saying that they're in financial final discussions with a number of different partners and that this deal will move forward that's the latest we have
Carl Quintanilla (Anchor) 02:29.470
yeah oracle shares now this is going to fill the gap going back to june rather than september at one seventy eight thanks seema seema mody