Alphabet Bets $4.75B on Data Center Firm to Power AI Arms Race

Google's parent company, Alphabet, announced on Monday it will acquire data center and energy infrastructure firm Intersect for $4.75 billion in cash, plus the assumption of debt. The deal is a direct move to secure the power-hungry infrastructure needed to compete in the fierce generative AI race against rivals like OpenAI, with the transaction expected to close in the first half of 2026.

The acquisition is designed to "help bring more data center and generation capacity online faster," Alphabet stated. In a tech landscape reshaped by AI, access to computing power is critical, but so is the massive amount of electricity needed to run it. OpenAI has reportedly made over $1.4 trillion in infrastructure commitments to meet demand, highlighting the colossal scale of investment required to stay competitive.

"Intersect will help us expand capacity, operate more nimbly in building new power generation in lockstep with new data center load, and reimagine energy solutions," said Sundar Pichai, CEO of Google and Alphabet, in a statement. Google was already a minority stakeholder in Intersect following a funding round announced last December.

It's not a complete takeover of all assets, however. Intersect’s existing assets in California and some in Texas are excluded from the deal, Alphabet clarified. Those will continue to operate as an independent company backed by current investors like TPG Rise Climate. The acquisition remains subject to customary closing conditions.