Solaris Energy Plans $1B Debt Raise to Fund AI Power Expansion

Solaris Energy Infrastructure, Inc. (SEI) has announced a plan to privately offer $1.0 billion in senior unsecured notes due 2032. The company intends to sell the debt to qualified institutional buyers under Rule 144A and to non-U.S. persons under Regulation S, subject to prevailing market conditions. These notes will be fully and unconditionally guaranteed by SEI and specific subsidiaries, linking the debt directly to the entity’s broader credit facility.

Proceeds from the offering will fund general corporate purposes and growth capital expenditures, supporting a strategic pivot toward long-term, fixed-fee power infrastructure. According to Stock Titan, this capital plan targets approximately $1.955 billion in capital expenditures for 2026 and roughly $5 billion in aggregate investment in its power generation platform. The move aligns with a broader shift toward contracted cash flows, reducing reliance on project-based construction revenues.

AI contracts drive capacity expansion

The debt issuance supports a rapid increase in operated capacity, which is set to grow from roughly 950 MW to over 3,300 MW by 2029. Solaris Power Solutions is central to this growth, generating about 80% of segment Adjusted EBITDA in Q2 2026. The company expects this segment’s contribution to exceed 90% of total Adjusted EBITDA by 2029, reflecting a more stable, infrastructure-like earnings mix.

This expansion is underpinned by three major AI data center contracts totaling approximately 2,200 MW with investment-grade technology customers. These include specific projects identified as Stateline, Hatchbo, and Customer C. Overall, SEI reports more than 2,300 MW of long-term contracted capacity, which provides the recurring revenue base necessary to support the new debt obligations.

Leverage rises above target levels

On a pro forma basis, the company’s Issuer-level leverage would reach approximately 5.3x Adjusted EBITDA. This calculation incorporates the new $1.0 billion notes and existing $1.3 billion in senior notes, using annualized Q2 2026 Adjusted EBITDA of roughly $433 million. This level exceeds SEI’s stated long-term net leverage target of about 3.0x, which the company aims to achieve as contracted cash flows scale.

To maintain liquidity, SEI reported $575 million in availability under its $650 million Revolving Credit Facility as of June 30, 2026. The company plans to increase these commitments to $850 million. However, the sustained high funding need implies significant execution risk, particularly given the recent acquisitions that expanded headcount from 468 to more than 2,100 employees and increased exposure to construction and services risks.

Acquisitions integrate engineering capabilities

Recent acquisitions, including Genco, GESA, Omega, and HVMVLV, have vertically integrated the company’s engineering and construction capabilities. The completed Omega acquisition involved the issuance of approximately 3.6 million Class A shares, which reduces existing holders’ percentage ownership. The debt offering itself does not dilute equity, as it represents a senior unsecured obligation rather than an issuance of common shares.