The US Army is turning to private equity firms, including industry giants Apollo, Carlyle, KKR, and Cerberus, to help fund a massive $150bn infrastructure overhaul. At a forum held last Monday, Army Secretary Daniel Driscoll and Treasury Secretary Scott Bessent met with about 15 leading Wall Street buyout firms to discuss strategic projects aimed at revamping the Army’s aging infrastructure.
Speaking to the Financial Times, Driscoll explained that the Army had a wealth of underutilized assets in its arsenals and depots, and he invited private investors to suggest creative financing models to leverage these resources. “We actually just want meaty projects,” he told the attendees, urging them to come up with unique ways to help meet the Army’s massive infrastructure needs. Potential projects discussed at the forum included building data centers on military bases, rare earth processing facilities, and alternative financing models such as trade-offs where land could be exchanged for computer processing power.
This latest effort by the US government to collaborate with private capital firms marks a key moment in the Trump administration’s ongoing push to tap into the $13 trillion private equity industry, a partnership that extends beyond traditional investment strategies and into national security.
According to Driscoll, the Army’s current budget is a far cry from the $150bn required for the overhaul. “We are in a hole that we are not going to be able to dig out of without creative solutions coming in from outside parties,” he noted. The Army’s infrastructure renewal plans are essential to modernizing the military’s operations, especially given the pressing need to update both technology and equipment.
In addition to discussing real estate refurbishment and supply chain financing, one attendee highlighted that the forum aimed to find cost-efficient capital for the Army’s supply chain and capital expenditures. Given Driscoll’s background in investment banking, it is clear that the Army is seriously looking to the private sector for creative solutions to its fiscal challenges.
Driscoll also mentioned the possibility of equity investments in critical industries, similar to the Pentagon’s recent $400 million investment in MP Materials, a US rare earths producer. This initiative is partly driven by concerns over China’s dominance in the rare earth market, which is critical for national security.
Cerberus, one of the firms in attendance, is particularly influential in the defence sector, managing over $65bn in assets. Carlyle, another major player, oversees $465bn in assets and has deep roots in defence contracting. The Army expects to receive several pitches from the firms over the coming weeks and plans to conduct due diligence before meeting with investors in New York. Driscoll aims to finalize multiple deals by the end of the year.
