Meta Partners with BlackRock to Build $14B AI Data Center

Meta, the parent company of Facebook, is teaming up with BlackRock, the world's largest asset manager, to build an artificial intelligence data center worth 14 billion dollars, or approximately 20 trillion won.

Meta announced on the 28th local time that it will establish a joint venture with BlackRock to construct the data center in El Paso, Texas.

Funds managed by BlackRock will hold an 80 percent stake in the joint venture, while Meta will hold 20 percent.

The two companies agreed to cover the total cost of approximately 14 billion dollars for data center development and infrastructure construction according to their equity stakes.

Specifically, Meta will contribute land and assets under construction valued at approximately 2.3 billion dollars in kind, while BlackRock will raise funds through debt and cash contributions.

To meet the 80-to-20 ownership ratio of the joint venture, Meta will receive a one-time distribution of about 1 billion dollars.

Meta plans to enter into an agreement to lease and use the entire completed data center, with the lease term renewable in four-year increments for up to 20 years.

Meta CEO Mark Zuckerberg emphasized, "Building infrastructure for superintelligence is core to ensuring that the benefits of this technology are distributed to everyone. Through our partnership with BlackRock, we are combining our expertise in designing and operating world-class data centers with one of the world's leading infrastructure investors to move faster and at a greater scale."

The El Paso data center, which has a computing capacity of 1 gigawatt (GW), is scheduled to begin full operations in 2028.

Meta's choice of a joint venture model that brings in BlackRock's capital rather than directly owning the data center is interpreted as a measure to ease the burden of AI infrastructure investments.

Big tech companies have been issuing tens of billions of dollars in bonds and bringing in external capital to cover astronomical investment costs.

Regarding this data center investment, Matt Britzman, a senior equity analyst at British brokerage Hargreaves Lansdown, pointed out to Reuters, "Meta does not have a large-scale cloud business that sells spare capacity to external clients at present," adding, "Questions still remain over an investment of this scale in terms of cash flow, future operating costs, and return on investment."

(Photo: AP, Yonhap News)
※ Please note: This article was translated by AI and may contain errors.