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Data center operator Switch is planning an IPO that could raise up to $10B and value the firm near $80B.
The move follows a period when most major data center companies left public markets, favoring private capital for expansion.
A wave of new IPOs in the digital infrastructure space suggests Wall Street is regaining favor as private capital sources grow strained.
The last several years saw major data center players, including Switch, move away from public listings as private equity and pension funds snapped up sector leaders. According to Bisnow, Switch was taken private in 2022 by DigitalBridge and IFM Investors in a deal worth $11B, after previously debuting on the NYSE in 2017. Blackstone, KKR, Global Infrastructure Partners, and American Tower led similar deals totaling over $35B for QTS Data Centers, CyrusOne, and CoreSite between June 2021 and early 2022.
By 2023, only Digital Realty and Equinix remained as pure-play data center REITs in public markets. The sector's heavy capex profile aligned well with the deep pockets and patience of private investors eager to fund the industry's rapid, AI-fueled expansion.
Switch, headquartered in Las Vegas, selected Goldman Sachs and JPMorgan Chase as its lead underwriters and could hit the public markets as soon as Q4, per Reuters. The potential offering may raise up to $10B, implying a valuation close to $80B—one of the largest US IPOs in years.
Switch operates large-scale data center campuses in markets such as Austin, Las Vegas, Reno, Atlanta, and Grand Rapids, Michigan, and positions itself as a leader in renewable-powered digital infrastructure; its assets have run on renewable energy since 2016. To support accelerated growth and facility upgrades for AI demand, Switch recently expanded its debt facility to $9.5B and considered a private funding round at over $40B valuation earlier this year.
The renewed interest in public offerings comes as the massive availability of private capital begins to wane. In the last year, digital infrastructure companies like Brookfield-backed CSquare and SoftBank-backed SBEnergy have disclosed IPO plans, targeting $1.35B and over $50B valuations, respectively. Blackstone's Digital Infrastructure Trust completed a $1.75B IPO for its REIT in early July.
Source: Yahoo Finance Top News — This article was automatically imported from the source. Read full article at original source →
