SoftBank Group Corp. has reportedly bought a Foxconn plant in Ohio to advance its Stargate data center collaboration with OpenAI.
Bloomberg revealed the purchase today.
Foxconn, officially Hon Hai Precision Industry Co., is the world’s largest contract electronics manufacturer. It assembles Apple Inc.’s iPhones and supplies servers to multiple cloud providers. The company is also active in numerous other markets including the auto sector.
Three years ago, Foxconn acquired a former General Motors Co. plant in Ohio to manufacture electric vehicles. It sold the facility earlier this week for $375 million to a newly created shell company. Foxconn didn’t name the organization behind the shell company, describing it only as an “existing business partner.”
Bloomberg’s sources said that SoftBank bought the plant as part of an effort to partner with Foxconn on Starlink. Announced in January, Starlink is a $500 billion initiative to build artificial intelligence data centers for OpenAI. SoftBank is one of the project’s main backers.
Foxconn is expected to continue operating the Ohio plant going forward. The company will reportedly repurpose the facility for the production of AI servers that could be used in Stargate data centers. According to Bloomberg, SoftBank and Foxconn may also use the Ohio site for other purposes.
It’s unclear what chips will power the AI servers that Foxconn intends to make at the plant. In February, Reuters reported that OpenAI was close to finalizing the design of its first custom AI chip. Using custom processors in Stargate data centers could help the AI provider reduce its reliance on Nvidia Corp. and thereby lower hardware costs.
Another possibility is that Foxconn will equip the AI servers with chips from SoftBank. In 2024, the latter company bought a startup called Graphcore Ltd. that makes machine learning accelerators. This past March, SoftBank inked a $6.5 billion deal to buy central processing unit developer Ampere Computing Holdings LLC. AI servers include both machine learning accelerators and CPUs.
The Ohio plant purchase is part of a push by SoftBank to take on a bigger role in Stargate. According to Bloomberg, the company is currently searching for a site that could host OpenAI’s flagship Stargate data center complex. The project is said to have drawn interest from large Japanese banks and other international institutional investors.
SoftBank has a subsidiary called SB Energy that develops solar farms and energy storage infrastructure in the U.S. Last month, the Wall Street Journal reported that sites tied to SB Energy could potentially be used to host Starlink data centers.
Photo: SoftBank
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