Firmus Technologies withdrew its application to list on the Australian Securities Exchange on Friday, scrapping what was set to be the country’s biggest listing since Telstra in 1997.
The backstory: Firmus builds liquid-cooled AI factories in Australia and across Asia, and is backed by chip maker Nvidia alongside Blackstone, Jane Street and Coatue. It had two small operational sites and an anticipated $44bn valuation.
- Five brokers were engaged to raise $7bn ahead of a planned 23 October listing at $11 a share.
Zoom in: The pitch unravelled midweek once it became clear bankers had vastly overestimated demand, prompting discussions about a heavy cut to the offer price, according to an investment manager briefed on the matter.
What they're saying: A Firmus spokesperson said the board decided proceeding with the offer was no longer in the best interests of the company and its shareholders, and that Firmus will now pursue capital from the private markets.
Between the lines: Guardian Australia had reported concern that early Firmus investors were going to use retail investors buying into the float as their exit strategy, leaving small investors exposed if the excitement dissipated.
- Shares in Firmus investor Maas Group plunged more than 20% on Thursday.
Yes, but: Veteran datacentre firm CDC ended a $73bn arrangement with Firmus this week. CDC chief strategy officer Jack Dan told a parliamentary committee that the two companies’ business models had started diverging significantly.
What's next: Firmus will consider alternative public and private market options and said it will update shareholders as those progress. The founders’ anticipated wealth will be greatly reduced.
Why it matters: This is a live test of how much public money will follow the AI buildout, and the answer from Australian institutions this week was less than the bankers assumed.
