The US–UK Technology Prosperity Deal (“the TPD”) marks a significant step in strengthening transatlantic cooperation and unlocking new opportunities for investment, innovation, and growth by bringing together leading technology investors, global chip suppliers, and infrastructure developers. It is expected to draw interest from venture capital, private equity funds, and corporates, reinforcing the transatlantic ties between technology leaders.
“The TPD is a clear signal that the US and UK view deep tech and data infrastructure as strategic priorities. Its success will be reflected in the capital invested and in the creation of durable partnerships that drive technology forward across the Atlantic”, said Gregor Pryor, Managing Partner for EME.
Key projects and tech players in the deal
Several US technology leaders and investors have backed the TPD, with commitments already valued at around £150 billion.
Before the TPD, the UK tech sector was valued at more than £1 trillion and contributed over £150 billion each year in gross value added to the economy. Data centres alone generated about £4.7 billion annually, supported over 40,000 jobs, and delivered £640 million in tax revenue. Forecasts suggest that growth in this segment could unlock a further £44 billion by 2035. Against this backdrop, the TPD represents a transformative injection of capital with the potential to accelerate progress in AI, data, and infrastructure.
“For corporates, the TPD is a double opportunity: to access new sources of investment and to shape standards on AI, quantum, and digital infrastructure. The businesses that position themselves early will be best placed to contribute to the way investment and regulation evolve”, added Mike Young, Head of the EME Corporate Group.
Beyond corporates, the TPD also creates opportunities for private equity and venture capital. Early-stage funds can back AI start-ups that benefit from expanded compute and research capacity, while growth and infrastructure investors can support new data centres, energy projects, and digital platforms. Investor participation is expected to grow well beyond the initial £150 billion as the sector scales.
From the projects announced so far, it is clear that US and UK policymakers are prioritising the development of state-of-the-art data centres. This infrastructure will enable further research and innovation in AI, quantum, civil nuclear, and health technology.
Below is a summary of the TPD’s flagship projects and investors:
Microsoft data centre, Microsoft Research, and Microsoft AI
- Lead entities: Microsoft
- Commitments so far: £22 billion over four years.
- Strategic purpose: Building infrastructure and equipping data centres, expanding the scope of AI and cloud services, and investing in research and innovation.
Data centre in Blyth (Northumberland) and Cobalt Park (North Tyneside)
- Lead entities: Blackstone, Nscale, OpenAI, Nvidia
- Commitments so far: £11 billion to be invested in Blyth by Blackstone.
- Developing an “AI growth zone” through infrastructure that supports AI research and growth and growth.
London-based DeepMind and Google data centre in Waltham Cross (Hertfordshire)
- Lead entities: Google/DeepMind
- Commitments so far: £5 billion over the next two years in research and development and site expansion.
- Strategic purpose: Bolstering DeepMind’s advanced scientific research and expanding the Waltham Cross data centre.
The AI infrastructure ecosystem
Investors
- PE funds
- Venture capitalists
- Sovereign wealth funds
- Tech companies
Microsoft
Chip industry
Infrastructure
- Nscale (data centres)
- Energy providers
- Property developers
Cross-border opportunities
The TPD has immediate implications for London’s (and the UK’s) position as a global tech hub. It is expected to strengthen supply chains, secure access to key materials, and create new avenues for international trade and export.
“London is already a global hub for technology and finance, and the TPD reinforces that position. The challenge now is to ensure that inward investment translates into a real opportunity for UK innovators and the communities around new data centre developments”, noted Brigid North, Managing Partner of Reed Smith’s London office.
The influence of the TPD will extend well beyond the UK, strengthening connections and opening opportunities across Europe and the Middle East. The TPD opens practical opportunities for collaboration and dealmaking across markets, driven by advances in AI, quantum, and digital infrastructure.
- United Kingdom: UK-based private equity funds are already positioning for increased deal flow in AI, data, and infrastructure projects, particularly in fintech, life sciences, and energy. Property developers and infrastructure funds will also find opportunities linked to data centre construction and the growth of green energy and digital corridors. These investments will accelerate innovation in areas such as quantum computing and health technology, where the UK is already showing global leadership.
- Europe: The TPD complements initiatives such as the EU’s AI Factories and Hubs, by creating new avenues for collaboration and shared expertise. Start-ups and researchers across Europe will benefit from closer links with UK-based infrastructure, helping accelerate innovation in generative AI, drug discovery, and clean-tech. At the same time, European investors will have the opportunity to co-invest in UK data centre developments and early-stage pipelines, supporting the scale-up of technologies with truly global reach.
- Middle East: Sovereign wealth and institutional funds in the region are well placed to act as co-investors, drawing on their track record in deep tech and large-scale infrastructure. The TPD’s focus on AI applications in energy, logistics, and smart cities aligns with Vision 2030 projects in Saudi Arabia and the UAE’s overall focus, where major investments are already being made into renewable energy, mobility technologies, and digital infrastructure.
For venture capital and private equity, the TPD creates a strong platform for future dealmaking. Venture funds may benefit from stronger exit opportunities through M&A and IPO activity. Private equity and growth investors can deploy capital into data, digital, and infrastructure projects with transatlantic backing. With AI, quantum, and green energy at the heart of the agenda, the TPD positions the UK and its partners as frontrunners in shaping the next wave of technological breakthroughs.
Key legal considerations
Businesses and investors looking to capitalise on the opportunities presented by the TPD can strengthen their position with a clear understanding of the regulatory landscape. Anticipating these issues early will enable faster execution, more effective deal structures, and greater resilience for long-term growth.
- Competition: Joint ventures and investments in AI and cloud services are likely to attract attention from regulators such as the UK CMA and the EU Commission. Engaging early and structuring deals with this in mind can help secure approvals and establish market leadership.
- Data protection: International collaboration will involve large-scale data transfers. Preparing compliance strategies for the US, the UK, the EU, and Middle Eastern regimes creates a competitive advantage and builds trust with customers and partners.
- Intellectual property: Clear ownership structures, licensing terms, and standards-essential patents not only reduce risk but also enhance deal value and create stronger monetisation opportunities.
- Tax and tariffs: Factoring in import duties on semiconductors, software licensing taxes, and FTA implications at the outset supports accurate modelling and positions investors to capture incentives as they emerge. Reed Smith’s Tariff Tracker provides up-to-date insight into global trade measures, helping companies anticipate changes and plan strategically.
- Property and infrastructure: Data centre development involves property, environmental, and planning considerations. Addressing these proactively opens the door to more sustainable projects and strengthens alignment with ESG-driven investment strategies. Reed Smith’s Data Centers: Bytes and Rights series offers insights on planning, financing, and sustainability to support companies and investors navigating this space.
Final thoughts
The TPD acts as a catalyst for immediate investment opportunities and provides a foundation for sustained growth. New channels in AI, data, infrastructure, and green energy will drive projects forward and expand the scope for innovation.
For venture capital and private equity funds, the TPD offers a strong pipeline of growth companies and clearer routes to exits, supported by rising demand for scale-up finance and international collaboration. For corporates, it creates the chance to influence market standards, build partnerships, and strengthen their competitive position.
Those who act early and align with the TPD will both benefit from and help shape its growth. With clear planning and decisive action, the TPD can deliver returns, accelerate innovation, and reinforce the UK and the US as leaders in the global digital economy.
Client Alert 2025-250
