* Goldman can provide junior capital, private credit and

debt placement, sources say

* Nvidia ( NVDA ) may back no more than 25% of financing, company

says

* Asset managers will take meaningful share of $500 billion

financing, one source says

By Saeed Azhar and Milana Vinn

NEW YORK, Aug 14 (REUTERS) - Goldman Sachs ( GS ) is in

talks with potential investors about participating in Nvidia's ( NVDA )

$500 billion AI financing initiative, after leveraging

its long-standing relationship with the chipmaker to secure a

coveted role in the deal, people familiar with the matter said.

U.S. insurers, money managers and banks are expected to form

the core investor base for the financing, one of the people

said, while asset managers plan to retain a sizable share of the

financing, a second source said.

Nvidia ( NVDA ) announced on August 10 it has partnered with six

major financial institutions including Goldman to launch compute

platforms aimed at raising over $500 billion in third-party

capital for AI infrastructure. The move highlights how surging

demand for AI computing capacity is drawing institutional

investors, as governments, companies and startups race to build

out data centers to support AI workloads.

Goldman can provide junior capital and private credit

financing through its asset management arm, while its investment

bank can also help place the debt into private credit funds and

eventually public debt markets, the second source said.

The first source said the firm had held discussions with a

wide range of investors about such structures, including banks,

asset managers, insurers and private credit firms.

The Wall Street bank's central role as the sole lender on

the deal, alongside alternative asset management giants such as

Blackstone and Apollo, marks the culmination of years of

ties with Nvidia ( NVDA ).

Goldman Sachs ( GS ) has advised Nvidia ( NVDA ) on several transactions and

on numerous technology financing deals in which the chipmaker

was an investor, according to Dealogic. The bank was also among

the lead underwriters on the chipmaker's $25 billion bond sale

in June and served as an exclusive financial adviser on Nvidia's ( NVDA )

$6.9 billion acquisition of Mellanox Technologies in 2019.

The bank's technology teams also maintain close ties with

Nvidia ( NVDA ), while the relationship extends to the highest levels of

both companies, the second source and a third source familiar

with the matter said. Less than two years ago, Goldman Sachs ( GS ) CEO

David Solomon interviewed Nvidia ( NVDA ) CEO Jensen Huang at a

technology conference hosted by the Wall Street firm.

"Jensen came, approached us with the idea, and we said we'd

love to talk to you about it," Solomon told CNBC in a joint

interview with Huang and executives of other partner firms after

the Nvidia ( NVDA ) financing plan was unveiled on Monday.

Nvidia ( NVDA ) declined comment and instead pointed Reuters to

Huang's blog post which details that the financing is to support

the buildout of AI infrastructure over time.

Nvidia ( NVDA ), which went public in 1999 in an initial public

offering led by Morgan Stanley ( MS ), is now worth about $5.2

trillion, making it the most valuable publicly listed company in

the United States.

UNUSUAL STRUCTURE

Goldman Sachs Research analysts recently noted the financing

needs for artificial intelligence are enormous with the top four

hyperscalers planning to spend more than $5 trillion by 2030 on

technology and data centers.

That scale of investment is likely to make private capital

an increasingly important funding source.

The demand has encouraged firms to explore new ways of

financing deals. The structure of the Nvidia ( NVDA ) financing differs

from earlier AI infrastructure deals that depended heavily on

vendor guarantees such as Broadcom's ( AVGO ) residual-value

guarantee on roughly $30 billion of senior debt backing

Anthropic's AI chip financing.

Nvidia ( NVDA ) CEO Huang said on X that the company has the option

to backstop up to $125 billion, or 25% of the potential deals.

The goal is to create an asset-backed market for AI compute,

allowing debt to trade more like traditional securities, which

could lower funding costs and draw a broader pool of investors,

the second source said.

"This appears to be a pivot away from vendor-financing,"

said Bank of America analyst Vivek Arya in a note. "The burden

sits with the consortium, not (Nvidia's ( NVDA )) balance sheet."