Blue Owl Capital will not fund Oracle’s (NYSE: ORCL) 1 GW AI datacenter project in Saline, Michigan, according to the Financial Times who spoke to sources close to the matter.
Oracle reported a cloud revenue miss in its most recent quarterly results while increasing its 2026 capital expenditure outlook to $50 billion.
The Financial Times reported negotiations faltered amid lender concerns over Oracle’s capital expenditures and increasing debt. Specifically, lenders asked for “stricter leasing and debt terms amid shifting market sentiment around enormous AI spending including Oracle’s own commitments and rising debt levels,” according to the Financial Times.
Financial Times sources said that Blue Owl was courting creditors to fund the projects, but now that it has withdrawn its support, those conversations have ceased. Oracle has reportedly signed agreements with OpenAI to utilize the Michigan site for AI computing loads.
Blue Owl has backed the bulk of Oracle’s biggest datacenter builds in the U.S., including its site in Abilene, Texas. These deals often utilize a buy-and-lease-back structure where the capital firm owns the sites and Oracle leases them to pay off debt.
With Blue Owl out, sources told the Financial Times that the Michigan site’s funding has reached a road block, with no new lenders stepping into Blue Owl’s place at this time.
Sources indicated that Oracle and Blackstone are in discussion for project financing, but nothing has materialized. The funding difficulty come amid a broader market decline that began on December 11. Bitcoin and equity futures fell alongside mining stocks as the AI cohort led a general decline in the tech sector. Oracle itself lost 13% after the company reported a miss for their cloud revenue for Q3, as reported by Reuters.
Oracle’s stock is down 5.5% today as of publication time.
