U.S.-based glass company Corning soared in premarket trading in New York after announcing a new mega deal with Nvidia to expand manufacturing capacity for fiber optic production used in AI data centers.
"Corning will increase its U.S.-based optical connectivity manufacturing capacity by 10x and expand its U.S. fiber production capacity by more than 50% to meet the accelerating demand driven by AI factory buildouts," Nvidia wrote in a press release.
The expansion includes three new manufacturing plants in North Carolina and Texas and is expected to create more than 3,000 high-paying U.S. jobs.
In a filing, Corning disclosed that Nvidia is making a $500 million equity-linked investment.
Under the deal, Corning issued Nvidia two warrants:
Traditional warrant: Nvidia can buy up to 15 million Corning shares at $180 per share.
Pre-funded warrant: Nvidia can buy up to 3 million Corning shares at a nominal exercise price of $0.0001 per share.
Both warrants are exercisable immediately and expire within three years, unless earlier triggered by the termination of the partnership agreement or a major M&A transaction.
Nvidia noted, "Corning's expanded capacity will supply the optical connectivity hyperscale data centers use to deploy NVIDIA-accelerated computing at scale."
In premarket trading, Nvidia shares are up 2.4%, while Corning shares are ripping higher, up 20%.
Source: ZeroHedge News
