Naver seals $9b Brookfield deal to finance AI factory

Naver has finalized a deal with US-based global asset manager Brookfield to secure up to $9 billion in artificial intelligence computing infrastructure, putting a formal financing structure in place for its $10 billion AI factory project with Nvidia.

Naver disclosed the agreement in a regulatory filing Tuesday, following its decision in July to name Brookfield its exclusive preferred negotiating partner for a 12-week period.

Under the deal, Brookfield will establish a special-purpose vehicle, tentatively named Asset Co, and invest up to $9 billion to secure graphics processing units, data centers and other AI infrastructure. Naver Cloud will access the computing resources through a GPU-as-a-service arrangement and provide AI data center services to external customers.

Naver will lead the AI factory business, drawing on its experience in building and operating clusters of graphics processing units and managing data centers. Nvidia will provide technical support, including its DSX high-performance computing platform, to improve the infrastructure's operating efficiency and competitiveness.

The structure is designed to reduce Naver's upfront capital burden. Brookfield will finance the infrastructure, while Naver Cloud will pay usage fees linked to revenue from the business, allowing it to expand computing capacity in stages as demand grows.

Despite being wholly owned by a Brookfield investment vehicle, Asset Co is expected to be included in Naver's consolidated financial statements as a subsidiary under Korean international financial reporting standards, based on Naver's control over the entity.

The agreement is also expected to bring Nvidia's planned $1 billion equity investment in Naver closer to completion. The US chipmaker is set to acquire newly issued shares through a third-party allotment, which would make it Naver's third-largest shareholder.

Naver announced the $10 billion global AI factory project with Nvidia and Brookfield in July.

Brookfield, which manages more than $1 trillion in assets, has a track record of investing in large-scale technology infrastructure. It has formed a semiconductor manufacturing joint venture with Intel and partnered with Microsoft on renewable energy development for AI infrastructure.

"By combining our AI technology and data center operating expertise with Nvidia's advanced computing platform capabilities and Brookfield's global infrastructure investment expertise, we can ensure the business is both stable and competitive," a Naver official said.

"We aim to create new growth opportunities in the global AI infrastructure market through a capital-efficient business structure," the official said.