Vantage Data Centers Explores $100 Billion IPO or Sale as AI Demand Fuels Data Center Valuations

Vantage Data Centers explores IPO or sale at $100 billion valuation

Vantage Data Centers is exploring options including an initial public offering or a sale, according to Reuters, as AI-driven demand pushes data center valuations higher and spurs dealmaking across the sector. Silver Lake, a private equity firm, and DigitalBridge Group, an infrastructure investor, back the company, which could fetch a valuation of roughly $100 billion through a stock market listing that raises around $10 billion -- a figure that would make it the largest data center IPO on record, according to Reuters, citing unnamed sources. A sale -- including a partial stake sale -- is also under consideration. Vantage has recently had early-stage conversations about potential exit options and informally met with financial advisers. The sources cautioned that nothing has been formally initiated, talks are still nascent, and the timing, structure, and scale of any transaction remain fluid. The company could ultimately decide against pursuing a transaction. Silver Lake declined to comment. DigitalBridge and Vantage did not respond to requests for comment. Since the end of 2023, Vantage has secured approximately $11 billion in capital, with a $9.2 billion equity round led by DigitalBridge and Silver Lake among those raises. Vantage recently joined forces with Oracle $ORCL and OpenAI to develop a data center campus in Wisconsin connected to Stargate -- a SoftBank, OpenAI, and Oracle joint venture targeting up to $500 billion in AI data center infrastructure buildout and 10 gigawatts of capacity. The potential listing would come as the data center sector sees renewed interest from public market investors seeking exposure to the computing capacity buildout required to support artificial intelligence. Data center owners have also drawn attention from technology companies and other strategic buyers looking to secure capacity for AI workloads. The sector is seeing a broader revival in public listings. Switch, another data center operator, has engaged banks for a listing that could bring in as much as $10 billion at an approximate $80 billion valuation, Reuters reported last month, and CyrusOne is also eyeing a possible public debut no later than 2027.

Vantage Data Centers explores IPO at $100 billion valuation or sale, sources say

NEW YORK, Aug 13 (Reuters) - Vantage Data Centers, a major hyperscale developer and operator, is exploring options including an IPO or sale as soon as next year, according to people familiar with the matter, as AI-driven demand lifts data center valuations and fuels dealmaking. Vantage, backed by private equity firm Silver Lake and infrastructure investor DigitalBridge Group, could raise around $10 billion and pursue a stock market listing at a valuation of about $100 billion, which would make it the largest data center IPO to date, two of the people said. The company may also consider a sale, including a stake sale, one of the people and a third person said. The company has held preliminary discussions in recent weeks about possible exit paths and met informally with financial advisers, the sources said. No formal process has been launched, the deliberations remain at an early stage and any plans, including the timing, structure and size of a potential transaction, remain subject to change, the sources cautioned. They requested anonymity because the discussions are confidential. Vantage could ultimately decide not to pursue a transaction. Silver Lake declined to comment. DigitalBridge and Vantage did not immediately respond to requests for comment. The discussions come as data center operators have attracted billions of dollars from investors seeking exposure to the rapid growth in computing capacity needed to support artificial intelligence. Data center owners have also become increasingly attractive to technology companies and other strategic buyers looking to secure capacity for AI workloads. Vantage has raised roughly $11 billion since late 2023, including a $9.2 billion equity investment led by DigitalBridge and Silver Lake. The valuation based on those raisings was not disclosed. Vantage recently partnered with Oracle and OpenAI on a data center campus in Wisconsin tied to Stargate, a joint venture between SoftBank, OpenAI and Oracle to build AI data center infrastructure of up to $500 billion and 10 gigawatts. The data center sector is also seeing a revival in public listings. Reuters reported last month that data center operator Switch had hired banks for an IPO that could raise up to $10 billion and value the company at about $80 billion, while CyrusOne is preparing for a potential IPO as early as 2027. (Reporting by Milana Vinn and Echo Wang in New York; Editing by Jamie Freed) By Milana Vinn and Echo Wang