SB Energy gave OpenAI $5.5B in warrants ahead of its own IPO
The SoftBank-owned developer granted its tenant warrants tied to a 20-year lease on a planned 10-gigawatt Ohio campus — before public investors got to price the company.
SB Energy granted OpenAI $5.5 billion in warrants ahead of the developer's US initial public offering, tied to a 20-year lease on a planned 10-gigawatt campus in Ohio, according to the Wall Street Journal.
The direction of the transfer is the striking part. The landlord gave equity to the tenant. Ordinarily a data centre developer with a signed 20-year lease from a creditworthy tenant has an asset to sell; here the developer paid $5.5 billion in warrants to secure the lease, and did so before public investors set a price on the company.
Why the tenant has the leverage
A 10-gigawatt campus is not built speculatively. It requires land, interconnection, generation and a construction programme measured in years, and the only way to finance it is against a committed offtake. Without a tenant of OpenAI's scale, the project is not bankable.
So the anchor tenant is not renting space. It is providing the credit that makes the project exist, and it has priced that accordingly.
That inverts the normal relationship, and it is the clearest evidence yet of where the scarcity actually sits. Compute buyers are assumed to be the supplicants in a market with constrained supply. On a project of this size, the developer is the one who needs the signature.
The timing is the governance question
Granting $5.5 billion of warrants before an IPO means the dilution is baked in before the public gets to price it. SoftBank, as owner, made a decision that transfers value from future public shareholders to a commercial counterparty in exchange for a lease that makes the business viable.
That can be entirely defensible — a project with an anchor tenant is worth more than one without, and existing shareholders may well come out ahead. But public investors are buying into a structure where a major customer is also a substantial warrant holder, which affects how future lease renegotiations, expansions and pricing discussions will run.
It will be disclosed. Whether it is well understood at pricing is another matter.
It is the same pattern as everything else this month
The AI infrastructure market has stopped being a set of arm's-length transactions. Nvidia is buying Hugging Face for $12.9 billion, putting about $2 billion into Nscale, discussing $2.5 billion into Thinking Machines, backing Lambda as it signs $35 billion with Anthropic, and taking the lease on a Texas data centre from Hut 8.
Now a power developer is granting warrants to a model company. Chips, capital, buildings, power and demand are increasingly held by parties with equity in each other, and every one of those relationships makes the aggregate demand signal harder to read from outside.
Iran, meanwhile, posted a video with satellite imagery threatening OpenAI's $30 billion Stargate facility in Abu Dhabi. Concentrating a decade of compute into a handful of identifiable gigawatt campuses creates a physical exposure that the financial engineering does not address.
SB Energy has not commented on the warrant terms, and OpenAI has not said what the lease commits it to.
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