Investor appetite for data centre initial public offerings is showing signs of fatigue, with several high-profile listings stalling in recent weeks. Air Trunk, a Blackstone-backed operator of server farms, has postponed its planned $1.5bn IPO in Singapore, marking the third such deal to falter in less than a month. Firmus last week pulled a $5bn float in Sydney, while SoftBank-backed SB Energy has pushed back its own IPO in New York.
The combined $12bn sought by the three companies represents only a fraction of the $5.2tn that McKinsey predicts will flow into the sector by 2030. However, investors appear increasingly cautious about unseasoned AI infrastructure stocks. Air Trunk was structured as a real estate investment trust, whose valuations tend to weaken as interest rates rise.
Nvidia-backed Firmus had tripled its valuation target since its last private fundraising round, and both Firmus and SB Energy remain lossmaking with negligible revenue, making traditional IPO valuation methods difficult to apply. While IPO proceeds offer flexibility and future access to capital markets, the hybrid nature of data centres—combining property, infrastructure and fast-evolving technology—may be better suited to project finance or venture capital. S&P already assumes data centres will last at most 25 years, half the lifespan it considers for general assets.
Despite the vast capital needs projected for AI compute—with Moody's estimating $3tn by 2031—public-market investors may not be the ideal providers of this funding.
Source: Financial Times Companies · Summarized by HeadlinesBriefing