Las Vegas, October 28 (Reuters) / PRNewswire / -- Hyperscale Data, Inc. (NYSE American: GPUS) is an artificial intelligence (AI) data center company. The company announced today that its indirectly wholly-owned subsidiary Alliance Cloud Services, LLC (referred to as ACS), has hired Newmark Group, Inc (referred to as Newmark), to find potential lenders to provide non-dilutive long-term debt financing for the development and expansion of the company's data center campus in AI, Michigan (referred to as "Michigan Campus"). This collaboration is aimed at supporting the company in financing the Michigan Campus in an institutionalized manner and reducing its reliance on the issuance of common stock.
Hyperscale Data indicates that Newmark is a globally leading commercial real estate consultancy and services provider, with specialized data center and digital infrastructure capital market operations. The data center projects publicly disclosed by Newmark include: arranging a $7.1 billion construction loan for a AI data center project in Abilene, Texas in 2025, as well as financing of $975 million for a new data center in North Virginia in 2026. More broadly, Newmark arranged approximately $59 billion in investments and an additional $73 billion in debt placements in 2025. Hyperscale Data believes that Newmark's professional experience in data center financing will help to introduce the Michigan campus to potential lenders and assess financing options that meet the project requirements.
Hyperscale Data Executive Chairman Milton stated, "The appointment of Newmark is an important step towards financing our Michigan campus in an institutionalized and long-term manner. If we successfully obtain the debt financing we are seeking, it will significantly reduce our need to raise additional equity capital for this project. We believe that Newmark's rich experience and professional capabilities can help us find a financing structure that reflects the scale of the Michigan campus and its expected revenue situation. Our goal is to responsibly advance the development while preserving more long-term value for our shareholders."
Hyperscale Data CEO William Horne stated: "With the assistance of Newmark, obtaining long-term debt financing will reduce our dependence on external equity and provide a stronger financial foundation for the long-term construction and operation of the Michigan campus. We aim to secure financing that will support the deployment of the necessary infrastructure for our customers and provide a clear financial framework for the advancement of the project. Our focus is on securing favorable terms, managing capital costs, and limiting dilution, while maintaining the financial flexibility required for execution."
The company stated that its financing goal is to obtain debt capital that suits the development needs of the Michigan campus and the expected operating cash flow. This process will assess the availability of long-term funds, potential borrowing structures, as well as repayment arrangements suitable for the transition of the Michigan campus from the construction and commissioning phase to the revenue-generating operation phase.
Management believes that obtaining appropriate institutional debt financing may improve the company's ability to plan capital expenditures at various stages of development. The company will evaluate based on the overall economic terms of the financing, including interest expenses, repayment obligations, mortgage requirements, contractual terms, and any other terms or conditions that lenders may require.
The Michigan campus is operated by ACS. The company previously announced that ACS has signed a main service agreement with a provider based in California, neocloud (referred to as "Customer"), to support the hosting of an initial 20 megawatts of critical AI computing power capacity and related data center services.
The initial term of this agreement is 10 years, and customers also have the option to extend it twice for an additional 5 years each time. The agreement also grants customers the right of first refusal for an additional 32 megawatts of capacity (if available), which could bring the total deployed capacity to 52 megawatts of critical AI computing power. The additional capacity and extension periods are still subject to the applicable contract terms and development requirements.
As previously disclosed by the company, Hyperscale Data expects that the first batch of 10 megawatts of critical AI computing capacity in the Michigan campus will be powered on in December 2026, and it is anticipated that revenue-generating activities will begin at that time. Achieving this timeline still depends on the completion of the necessary infrastructure construction and debugging work.
The company emphasizes that the hiring of Newmark does not constitute a loan commitment, nor does it indicate that financing has been secured. Any financing will depend on the underwriting by lenders, due diligence, formal agreements, and applicable delivery conditions. The amount of financing, pricing, duration, and other terms have not yet been announced. There is no guarantee that the company will be able to obtain financing on acceptable terms, or even that financing will be possible at all, nor can it be guaranteed that this will eliminate the need for additional equity capital.
For more information regarding Hyperscale Data and its subsidiaries, the company recommends that shareholders, investors, and other interested parties read the public documents and press releases published under the Investor Relations section, which can be found at the website hyperscaledata.com, or visit www.sec.gov.
Regarding Hyperscale Data, Inc.
Through its wholly-owned subsidiaries Sentinum, Inc, and Hyperscale Data, AI owns and operates a data center that provides hosting and server hosting services for the emerging AI ecosystem as well as other industries. Another wholly-owned subsidiary of the company, Ault Capital Group (referred to as ACG), is a mixed-type private equity and operations firm that acquires, finances, builds, and actively manages businesses in the fields of financial services, digital assets, industrial services, hospitality, defense technology, and others.
Hyperscale Data Currently, it is anticipated that the divestiture transaction of ACG (referred to as "divestiture") will occur in 2027. Upon completion of the divestiture, the company will become the owner and operator of data centers that support high-performance computing services, while also holding digital assets, as well as its third wholly-owned subsidiaries: Omnipresent Robotics and LLC. Before the divestiture is completed, the company will continue to provide key products that support various industries through ACG and its wholly-owned and controlled subsidiaries, as well as strategic investments. These products include the AI software platform, equipment leasing services, and businesses in defense/aerospace, industry, automotive, and hospitality. In addition, ACG is actively engaged in private lending and structured financing activities through its licensed lending subsidiaries Ault Lending and LLC. Hyperscale Data is headquartered at Room 190, 11411 Southern Highlands Parkway in Las Vegas, Nevada.
On December 23, 2024, the company issued 1 million newly designated Series F exchangeable preferred stocks (referred to as Series F Preferred Stock) to all common stockholders and holders of Series C preferred stocks calculated on a converted basis. The spin-off will be achieved through the voluntary exchange of Series F preferred stocks for Class A common stocks and Class B common stocks of ACG (collectively referred to as "ACG shares"). The company reminds shareholders that only holders of Series F preferred stocks who agree to surrender these shares in the spin-off exchange offer and have not properly withdrawn their surrender requests will be entitled to receive ACG shares and become shareholders of ACG after the spin-off takes place.
Forward-looking Statements
This press release contains “forward-looking statements” as defined by Section 27A of the Securities Act of 1933 (as amended) and Section 21E of the Securities Exchange Act of 1934 (as amended). Such forward-looking statements typically include projections, assumptions, or references to future events or conditions, and use words such as “believes,” “plans,” “expects,” “anticipates,” “estimates,” “hopes,” “intends,” “strategy,” “future,” “opportunity,” “possible,” “will,” “should,” “can,” “potential,” and similar phrases. Statements that are not historical facts are considered forward-looking statements. Forward-looking statements are based on current beliefs and assumptions, but these beliefs and assumptions involve risks and uncertainties.
Forward-looking statements are only valid as of the date they are made, and the company assumes no obligation to update any such statements due to new information or future events. Due to various factors, actual results may differ significantly from those contained in any forward-looking statements. Additional information that may affect the company's business and financial results, including potential risk factors, is contained in the documents submitted by the company to the U.S. Securities and Exchange Commission, including but not limited to Form 10-K, Form 10-Q, and Form 8-K. All documents can be found at www.sec.gov and on the company's website at hyperscaledata.com.
