By Lucy Ratano
LONDON (Reuters) – Nebius Group said Wednesday it would raise $3 billion to grow its core artificial intelligence cloud business, which signed a $17.4 billion deal with Microsoft.
The funding includes a $2 billion individual offer of convertible senior notes and a public offering of $1 billion underwriting of the company's Class A shares.
Goldman Sachs is the lead book running manager for the public offering, along with Morgan Stanley, Bofa Securities and Citigroup.
Nebius said it will use cash to fund continuous growth, including acquiring additional computing power and hardware, protecting land parcels with trusted providers, and expanding data center footprints.
On Monday, Amsterdam-based Nebius announced that it will provide GPU infrastructure capacity to Microsoft over a five-year term. Microsoft could also acquire additional service capacity under the transaction and bring the total contract value to approximately $19.4 billion.
On Tuesday, Nasdaqlist shares surged to record highs above 49%, driven by Microsoft trading. This year, it has increased by 245% so far. Stocks fell 5.6% in pre-market trading on Wednesday.
Nebius emerged from the transaction to split the assets of Russian high-tech company Yandex.
In recent years, global demand for data center capabilities has skyrocketed in recent years, especially after the advent of generative artificial intelligence, as companies have been operating their businesses using new technologies.
(Reporting by Lucy Raitano, Editing by Amanda Cooper and Kirsten Donovan)
