HIVE Digital Subsidiary Secures $129 Million Loan to Fund NVIDIA GPU Cluster for AI Contract
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Key Takeaways
- BUZZ Alpha Cloud Inc. secured a $129 million loan at a 9.0% fixed interest rate over three years.
- Proceeds will fund a $165 million purchase of 2,303 NVIDIA GB200 GPUs and related infrastructure.
- The hardware will support a $225 million sovereign AI contract with Cohere in Canada.
- The loan represents an 80% loan-to-cost ratio, with the balance funded by HIVE's 0% interest convertible bonds.
- GPU delivery is expected to take place toward the end of Q4 2026.
HIVE Digital (NASDAQ: HIVE) Technologies Ltd., headquartered in San Antonio, Texas, disclosed that its subsidiary BUZZ Alpha Cloud Inc. has finalized a $129 million credit facility to expand its high-performance computing (HPC) infrastructure. The financing is structured as a single-digit, fixed-rate loan at 9.0% per annum over a three-year term.
The proceeds are earmarked for the acquisition of an NVIDIA GB200 NVL72 GPU cluster and associated infrastructure, valued at approximately $165 million. This equipment is scheduled for deployment to satisfy a previously announced three-year fixed-term sovereign AI contract with Cohere. HIVE stated the total contract value (TCV) for the Cohere deal is $225 million, which includes GPU compute services along with connectivity and storage revenue.
According to the filing, the loan represents an 80% loan-to-cost ratio. The remaining equity portion for the hardware purchase is being funded by proceeds from 0% interest convertible bonds issued by HIVE earlier this year, which generated approximately $200 million in net proceeds. The company expects the delivery of the 2,303 NVIDIA GB200 GPUs to occur toward the end of the fourth quarter of 2026.
The facility is secured by the GPUs and related assets held by BUZZ Alpha Cloud. While BUZZ High Performance Computing Inc. provided a limited recourse guarantee and a pledge of its equity in the borrower, it is not otherwise liable under the financing agreement. The loan will be repaid through contract revenue via a fixed amortization schedule, and HIVE will own the GPUs outright at the end of the three-year term with no residual payment required.
