This article first appeared on GuruFocus.
Nvidia (NASDAQ:NVDA) shares slipped about 1.5% Monday after a Reuters report said the chipmaker is considering an investment of as much as $3 billion in power infrastructure firm Lancium.
Nvidia could commit another $1 billion if Lancium reaches certain targets tied to power-grid connections, people familiar with the matter told Reuters. The potential transaction would value Lancium, including its land and energy assets, at about $10 billion.
Lancium intends to use the funding to expand its operations and is considering a potential public listing in 2027. Nvidia and Lancium did not respond to Reuters requests for comment.
Nvidia’s potential investment would deepen its exposure to the infrastructure supporting AI computing. Lancium operates a 1,000-acre data center campus in Abilene, Texas, where the Stargate AI project began operations.
The Stargate initiative involves SoftBank, OpenAI and Oracle (NYSE:ORCL), with plans announced in January for as much as $500 billion of AI infrastructure investment. Nvidia has also pursued infrastructure-related partnerships, including an agreement with Marvell Technology that included a $2 billion investment.