Waymo Taps Pimco, Blackstone for $3 Billion in First Debt Deal

Waymo is in the final stages of talks to raise debt for the first time, tapping lenders including Pacific Investment Management Co. for more than $3 billion as it looks to become the leading robotaxi company globally.

Blackstone Inc. and Sixth Street Partners are among other lenders providing the loan to Alphabet Inc.’s autonomous driving unit, according to people with knowledge of the transaction. The debt will be unrated and could price at more than 500 basis points over the benchmark, the people said, asking not to be identified as the details are private.

Waymo, which has been working with Goldman Sachs Group Inc., is looking to finalize the deal in the coming days, the people said. The discussions are ongoing and details may change, they added.

Representatives for Waymo, Goldman Sachs, Pimco, Blackstone and Sixth Street declined to comment.

Waymo has traditionally relied on the equity markets to help fund its growth, raising $16 billion earlier this year at a valuation of $126 billion. But as Waymo continues to expand its driverless fleet and grapples with rising AI costs, it is looking for other forms of capital that’ll allow it to grow into a more mature firm.

Waymo, which last month said it built a custom chip to help improve the performance of its robotaxis, has set a goal of operating 1 million paid weekly rides in 20 cities globally this year. It already provides more than 500,000 paid trips every week in 14 US cities and is laying the groundwork to test its service in more than a dozen places, including London and Tokyo.

The debt financing is a way for capital markets investors to get to know Waymo and follows a similar path to other driving companies.

Uber Technologies Inc. raised debt for the first time in 2016, tapping leveraged loan investors for $1.15 billion to help it plan its expansion, before going public three years later. Since then, Uber has been a repeat issuer of debt in the capital markets.

Read more: How Robotaxis Are Making Headway, Glitches and All: Explainer