Alphabet’s $4.75 billion acquisition of Intersect signals a massive AI infrastructure push

Alphabet is making a decisive move to secure the physical and energetic backbone required for the future of its AI ambitions. The company announced today that it is acquiring Intersect, a data center and energy infrastructure firm, in a deal valued at $4.75 billion in cash plus the assumption of debt (via 9to5 Google). This isn’t just a standard corporate acquisition; it is a strategic play to solve the massive power and scaling hurdles that come with the current generative AI explosion.

A deeper integration for hyperscale scaling

While Intersect will remain its own brand under the Alphabet umbrella, the team is set to partner closely with Google’s internal infrastructure group. This collaboration aims to accelerate the construction of new data centers while simultaneously diversifying how those facilities are powered. As AI models become increasingly resource-heavy, the ability to build and power these “hyperscale” environments becomes a competitive necessity.

Building on a proven partnership

The relationship between the two companies isn’t new. Google already held a minority stake in Intersect following a funding round in late 2024, and the two have already broken ground on a co-located data center and power site in Texas. That site will be included in this deal, though Alphabet noted that Intersect’s existing assets in Texas and California will be spun off into a separate, independent entity.

Solving the energy and grid crisis

One of the most significant aspects of this acquisition is the focus on the energy grid. As tech giants continue to scale, the strain on public utilities has become a growing point of friction. Alphabet’s announcement specifically highlighted a commitment to expanding capacity without passing those infrastructure costs on to everyday grid customers. By bringing energy generation expertise in-house, Alphabet can more effectively synchronize power production with the heavy load requirements of its data centers.

Looking toward a 2026 completion

In a statement regarding the acquisition, Alphabet CEO Sundar Pichai noted that Intersect will allow the company to operate more nimbly, reimagining energy solutions to drive innovation. Sheldon Kimber, the founder and current CEO of Intersect, will continue to lead the team as they integrate into the Alphabet family.

This acquisition is a clear signal that Google is looking beyond just the software and hardware of AI, focusing instead on the literal power required to keep those systems running. The deal is expected to officially close in the first half of 2026, marking a significant milestone in Alphabet’s long-term infrastructure roadmap.