CIBC Capital Markets' Alfred Traboulsi leads our semi-annual discussion with US Corporate and Investment Banking leads on the evolving landscape of the financial markets in the US in 2026 and beyond. The panel highlights the transformative role of AI and infrastructure investment, record-setting equity and debt issuance, the convergence of power and digital infrastructure, and strong investor demand across sectors.
CIBC Perspectives
US Financing & Advisory - Mid-Year Update
Alfred Traboulsi
Managing Director & Co-Head, Global Corporate & Investment Banking, CIBC Capital Markets
Hello everyone, I'm here in New York today leading a mid-year 2026 outlook for the financing landscape where we'll hear from my CIBC colleagues from a wide spectrum of expertise ranging from debt, equity, and advisory.
Artificial intelligence and investment in infrastructure are making transformative changes across sectors globally and are driving unprecedented flows of capital. Today we will dive more deeply into how this is shaping markets and share insights to help you make more informed decisions.
There's a lot to discuss, so let's jump straight into it. I'm going to start with Greg Ogborn from our U.S. Equity Capital Markets team. Greg, how do you think AI infrastructure thematic is impacting the equity markets and what insight can you share regarding the ways companies are coming to market?
Greg Ogborn
Managing Director, Equity Capital Markets, CIBC Capital Markets
Sure. Thanks, Alfred. It's a great question and it's obviously one that's top of mind for equity capital markets bankers.
But first, I would say the scale of issuance is genuinely historic, though it is narrow, right? So, if you look at SpaceX plus potentially what we'll see from OpenAI, Anthropic, maybe even Databricks, right? If you add up the market values of those companies it's $3.6 or so trillion, and those four names alone are larger than the entire market cap of all the companies that came public in 2021, which was, of course, the previous record year.
In addition to just the scale of the companies coming public, the buyback to issuance reversal is an important structural story here. So, for example, Google repurchased about $130 billion of stock in the 12 months ended March 2026, yet now has pivoted to an $85 billion equity and equity-linked capital raise here. And of course, Capex is the forcing function here. There's about $700 billion dollars of Capex required by the four, or I'm sorry, by the five hyperscalers alone, and the deal flow, of course, has been breathtaking.
Last night, of course, we saw the largest ever IPO in history, the $75 billion SpaceX IPO and yet, what's remarkable about that is that it wasn't even the largest equity deal of the month. If you add up the various tranches of, of the Google equity and equity link raise, earlier in June, you know, that was $85 billion. So just a massive amount of supply coming to market.
I would say it's important to note the central role that the convert market is playing in the AI funding cycle. The convertible bond market and mandatory converts could match or surpass the record set last year, which was about $120 billion raised. Mandatory converts are having their time in the sun. We saw a $5 billion mandatory by Oracle earlier this year, and then of course part of Google's $85 billion is the $16.75 billion that they did with the mandatory earlier this month.
And this I would say similar story with ATMs - we are seeing Oracle go to market with a $20 billion ATM program, Google doubling that with a $40 billion ATM program, and I'll note both on the converts where we have capabilities there in New York. We recently hired a new head of U.S. convertible origination in equity capital markets, and then also on the ATM side I would note that's a product where we've been particularly active and we have capabilities on the trading floor in New York dedicated to the ATM product.
And lastly, I would say the, you know, power as the bottleneck is a theme that has come to market and will continue to drive equity capital markets activity. I'll just note Fervo was an IPO in May, they raised $1.9 billion, and they achieved what I call the trifecta, right? Where they upwardly revised their valuation range, they then priced a dollar above that revised range and then traded up very meaningfully in the aftermarket it was up 35% on day one. It continues to trade about 30% above the offer price. So that was a successful deal, but we are gonna see others in the power space or the behind-the-metre space come to market later this year and then into 2027.
There's some risks here in the market, you know there's a great deal about which to be excited, but at the same time I would just point out, you know, these mega deals do need to work, investors need to make money in order for them to continue participating in all the supply that's expected to come, and then of course, you know, looking at historical precedence perhaps, right? Looking at the the fiber overbuild in the late 90s into early 2000s, and then even further back in history, right? The railroad overbuild is a cautionary tale.
But where I would conclude here is just talking about recommendations to clients that are contemplating hitting the equity capital markets. it's critical that we maintain open and regular dialogue with clients, and for those that are contemplating equity capital markets, it's imperative to get ready early in order to maximize one's optionality to tap the markets when they're open.
And finally, I would say it's important to take an expansive view of investor targeting, and that's an area where we can be particularly helpful as well, just given the deep longstanding connectivity we have with Canadian investors who are very, very eager to participate in the funding of the AI build out in the United States and elsewhere.
Alfred Traboulsi
Greg, thank you, and I would be remiss not to mention the success of our Canadian depository receipt that is also launching on SpaceX today as we speak. So, that's a first and that's a great pride for CIBC.
I'm going to next go to Ed and a different side of the risk spectrum with investment grade. Ed, you had our U.S. Investment Grade Syndicate. What are you seeing from issuers and investors across our utilities, data infrastructure and what do you think the market will be watching most closely in the second half of the year?
Ed Eighmey
Managing Director, Fixed Income, Debt Capital Markets, CIBC Capital Markets
Thanks, Alfred. Obviously in addition to to Greg's commentary from an equity standpoint, clearly coming into 2026, the market was well prepared and expecting an uptick in issuance, not only from the direct hyperscalers, call it the five or six, the Amazons, Alphabets, Googles and Metas of the world.
We're at $1.1 trillion, almost through the first half of the year. That is the fastest pace to this type of volumes, the quantum of debt being raised is pretty remarkable, particularly in the context of an interest rate environment that's 30 basis points higher from the start of the year. You have the hyperscaler community just shy of $110 billion of direct issuance. You have the the data centre, less C-type transactions, just shy of $30 billion of issuance. So when you think about the whole ecosystem of the hyperscaler data centres, you're talking about close to 16% - 17% of issuance thus far this year, coupled with of course the utility, the energy and power supply, which pushes an another $150 billion in total.
So when we think about the ability for the market to continue to underwrite the risk at spreads that are hovering near multi-decade lows, I think there was some consternation and some worried issuers that these fortress balance sheet type companies were going to print with elevated new issue concessions. We saw that in October. That was very short-lived. We're seeing these type of trades, whether it's Amazon's $37 billion come to market with very narrow concessions, trading well, in addition to what we've seen in the U.S. dollar market, there's been another $60 billion that have been issued from the hyperscaler community across currencies, which again I think is helpful sending a message to the U.S. market that there are other levers to pull. whether it's private placements, whether it's Swiss francs, we've seen two of the largest trades ever issued out of Canada, Alphabet and Amazon, for a total of $24 billion CAD.
It again, it's pretty remarkable the ability to underwrite this risk from the investor community, and there seems to be more demand and the expectation going forward is that we'll see continued supply, again, both from the direct hyperscalers, the energy infrastructure, utilities, their Capex needs, are in the, you know, half a billion, half a trillion dollars, rather, over the next couple of years.
So I think as we guide issuers, one, if you're focused on spreads, there is no reason to wait. We're again, the IG index is at 75 basis points, you have to go back to the late nineties to see those type of spreads. Obviously we continue to be in an elevated interest rate environment, having said that, just given the Capex needs, given the underlying health of the economy, issuers are are happy to enter this market and take advantage of the liquidity and the capacity that continues to exist.
Of course, it's the unknown unknowns that we think about in the second half of the year. As of now, we we continue to grapple with, obviously, the geopolitics, now we're pricing in rate hikes for the end of the year, and yet we're still hovering all-time tights, equities at near historic highs. So again, I think our guidance to and our advice to issuers is to take a very hard look. It's tough to imagine the environment getting much better from here.
Alfred Traboulsi
Ed, thank you so much. I'm gonna move now to the bank markets. Philipp, you're a senior member of our project finance team. Tell us more about how the convergence is happening across power and AI infrastructure and that is reshaping the project finance landscape. And also tell us how is CIBC helping our clients navigate the risk and opportunities emerging from that convergence.
Philipp Slabik
Executive Director, Project Finance, CIBC Capital Markets
I think that the energy infrastructure landscape has evolved quite rapidly in 2026 so far, driven primarily by surging power demand policy shifts, as well as competition for capital. The great part about being a banker at CIBC is that we're able to help our clients navigate this reality in real time. But first, let me summarize a few key observations we've made so far that will likely shape the markets for the remainder of the year, if not beyond.
First, power availability has become the binding constraint across the market, especially in data centre development. Capital, while finite, is available, but megawatts are more constrained. We're partnering with our clients to work on solutions to address this environment, whether through behind-the-metre generation, integrated power strategies, or combined financings that are putting together digital infrastructure and power projects into one financing transaction.
Second, renewables have entered an accelerated development cycle. The combined effects of the IRA and OB3A has pulled forward development activity, with our clients moving quickly to ensure that their wind and solar projects are qualifying for tax credits that are set to expire by the end of 2027. In response, we're frontloading due diligence, particularly with respect to foreign entity of concern rules, stress testing construction timelines and also negotiating stronger contractual protections to ensure bankability under compressed deadlines and an ever-evolving supply chain landscape.
Third, the LNG wave is clearly continuing. Alfred, you know that there are currently 24 billion cubic feet per day of capacity under construction, with another 11 already approved by FERC. Those projects clearly need access to capital to advance development. The importance of LNG is further enhanced by the current geopolitical uncertainties. It is also worth pointing out that capital allocation is being reshaped by the high demand from the sectors that I just mentioned, especially from sectors like LNG, power, and digital infrastructure.
At CIBC, we're helping our clients by leveraging our underwriting and syndication capabilities. Going forward, however, we think that hybrid capital solutions, bringing together traditional bank liquidity as well as private credit, will take on a more prominent role that will drive optimal execution for our clients.
Finally, we're observing a solid increase in PPA prices across the energy mix. Solid demand growth, driven primarily by AI, but also by broader industrial growth and electrification trends, is improving revenue visibility and is strengthening project economics across various technologies. In this environment, we're working closely with our clients to execute on their business plans, in areas like data centres, LNG, battery storage, but also gas fire generation, where long-term demand growth is aligned with bankable structures.
At the same time, and as a leading bank in the space, we're committed to our renewables clients. We're helping them to manage near-term execution constraints and positioning their development pipelines to capture long-term value as the market continues to evolve.
So, stepping back, Alfred, I think the key theme of 2026 so far is convergence between power and infrastructure, policy and financing, but also between traditional and alternative capital. Our role at CIBC has been on anticipating these shifts, and positioning our clients for maximum execution certainty in a market that is clearly getting more complex, but also more rich in opportunities.
Alfred Traboulsi
Philipp, thank you. That's a very interesting way to frame it. I'm going to go from New York over to Houston and to you, Marc. You're a senior member of our Leverage Finance Team. Tell us how is the power and energy landscape adapting to the growth and demand and what are you seeing as key changes in the market as it relates to this paradigm shift?
Marc Borden
Managing Director, Leveraged Finance, CIBC Capital Markets
Sure, I think Philipp said it well - convergence. The molecule is converging on each other, right? We used to have bifurcated upstream, midstream, downstream, power, NAT gas fired, gen - everything is converging. We're seeing oil field services players transition and pivot into you know behind the metre power for data centres every single day.
We are seeing a new request for capital come in, whether that's in the institutional market, whether that's in the Term Loan B market, whether that's in the high yield market, and investor appetite is candidly insatiable. I think we when we look at curves, when we look at capacity prices, whether you're in ERCOT, whether you're in PJM KISO across the board, you know, effectively it is up and to the right, and so while leverage has continued to creep up in the sector, no doubt on a debt per KW basis, spreads have actually compressed materially.
It wasn't too long ago that we were looking at, you know, single asset, NAT gas fire gen plans being financed in the Terminal B market, you know, maybe four or five hundred dollars a KW, you know, spreads in the, you know, if you were lucky to have a three on it. Now we're seeing, you know, debt per KW push 900 plus, and we're seeing spreads materially compress. You know, today we're seeing deals single asset, NAT gas fire gen get done, you know, 225 over SOFR. The higher leverage deals are still getting done in the low 300s. Investor appetite is significant.
And on that point, you know, historically up until about 2024, the average volume in the sector, in the power gen sector, was roughly four to five billion dollars in the leverage finance capital markets. Over the last call it 30 months, we've seen $60 billion of net new supply, and then when we look at repricings, as I mentioned, spreads of compressed materially, when you add in the repricing transactions, that brings total volume to $100 billion. So, orders of magnitude above the run rate that we've historically seen, and you have the likes of a Vultagrid, who were, you know, a top lender too, trading at 6%. The overall high yield index trades at 7%, the double B index trades at 6% Solaris, another one of our top tier clients, they are trading at 6% as well, right? Inside the overall index by a lot and we continue to see significant investor appetite in reverse inquiry in the sector.
And like I would say, and I think you're hearing it from a lot of my colleagues, CIBC is absolutely front and centre open for business on this point. We are looking to deploy our capital in order to support this convergence of the molecule and we're doing it every single day and we're having conversations with existing clients, new clients, just so regularly.
So, maybe I'll stop there and and hand it back over to you, Alfred.
Alfred Traboulsi
Marc, thank you so much. Last but not least, my final question is going to go to Neil. You have led the largest number of power asset transactions than anyone else in the U.S. in the past eighteen months. Where are we in the cycle and what should we expect to see in terms of power sector deal flow for the balance of the year and beginning of next?
Neil Davids
Managing Director, Energy, Infrastructure and Transition, CIBC Capital Markets
Yeah, thanks, Alfred.
There hasn't been an insatiable demand for power in the U.S. We all know the statistics, 3.5% growth for the next five years expected in U.S. power. That's after about 20 years of flat growth. But that's also coming along with a myriad of of challenges and that comes along with whether it be regulatory, affordability, and also in terms of turbine supply, right? So those three items are really causing the deal sector to power up.
So, what we're seeing in the M&A sector is large-scale utility transactions like Nextera acquiring Dominion. We're also seeing several private equity exits to natural holders of thermal assets. We're seeing people continue to raise capital through whether it be sell downs of renewable assets or for utilities selling minority interests in their operating companies.
So, what I expect to see for the rest of the year is what we call at CIBC the battle for electrons. We're gonna see IBPs continue to be very active in M&A and use their currency and their balance sheet to acquire the remaining privately owned thermal assets. I think you're gonna see a lot of private equity sponsors that have seen success in the thermal landscape raise larger funds and try and reconstitute what they accomplished prior by acquiring new assets.
And then I think it's gonna also gonna be a battle of scale amongst utilities as scale helps you acquire larger loads. So you'll see regional utilities potentially look down the M&A route. And on the renewable energy side of things, you'll continue to see an asset rotation market that's quite vibrant as they continue to raise capital to fund their large pipelines.
All in all, you know, we've been a part of $21 billion of M&A over the last twenty four months across nearly twenty transactions, and it's been a delight to serve our clients and help them achieve valuation expectations way in excess of what they ever dreamed.
Alfred Traboulsi
Neil, thank you and congratulations on great success. I'd like to thank you, Greg, Ed, Mark and Philipp, all great discussions and insights. I'd like to thank our viewers for taking the time to watch this video. As always, please feel free to reach out to any of the team here at CIBC. We would be delighted to discuss with you any specific opportunities. Thank you.
CIBC Perspectives
US Financing & Advisory - Mid-Year Update
Host
Alfred Traboulsi, Managing Director & Co-Head, Global Corporate & Investment Banking, CIBC Capital Markets
With:
Greg Ogborn, Managing Director, Equity Capital Markets, Global Investment Banking, CIBC Capital Markets
Ed Eighmey, Managing Director, Debt Capital Markets, Global Investment Banking, CIBC Capital Markets
Philipp Slabik, Executive Director, Project Finance, Global Corporate Banking, CIBC Capital Markets
Marc Borden, Managing Director, Leveraged Finance, Global Investment Banking, CIBC Capital Markets
Neil Davids, Managing Director, Energy, Infrastructure and Transition, Global Investment Banking, CIBC Capital Markets
All opinions and estimates expressed in this video are as of the date of publication unless otherwise indicated, and are subject to change.
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CIBC Capital Markets
® The CIBC logo and "CIBC Capital Markets" are registered trademarks of CIBC, used under license.