Nvidia-backed Firmus pulls its AI data center IPO after investor demand craters

Firmus Technologies withdrew its application to list on the Australian Securities Exchange on October 9, abandoning a bookbuild that had targeted roughly $7.1 billion at an implied market valuation near $44 billion. The Nvidia-backed AI data center operator had priced shares at $11 each the week before, with trading set to begin October 23. Instead, the company told investors the offer terms "would not appropriately reflect the strength of the company's business" and that proceeding was not in shareholders' best interests.

The collapse came fast. Joint lead managers Morgan Stanley, Bank of America, JPMorgan and Morgans Financial had described demand as strong just days earlier. By Wednesday night, the syndicate was testing a cut to $9 a share — a move that would have erased roughly $8 billion of market value — before pulling the deal entirely on Friday morning. Underwriters stood to earn an estimated $215 million in fees had the listing closed.

Thin operating base, heavy promises

The resistance centered on a gap familiar across the AI infrastructure buildout: Firmus has 46 megawatts of compute actually running, against 865 megawatts under development and plans for 3.2 gigawatts in total. The company was pitching roughly $20 billion in combined contract revenue once sites with clients including OpenAI and Meta go live by 2028, against last year's reported revenue of about $50 million. Morgan Stanley had floated a valuation as high as $65-90 billion, well above where the deal was ultimately priced — and still investors would not clear it.

Confidence evaporated

That was fund manager Jun Bei Liu of Ten Cap describing the bookbuild's final days, adding that Firmus "needs to be a bit more mature" before testing public markets. Wilson Asset Management's Oscar Oberg framed the skepticism differently, telling reporters that "if you don't believe in Firmus, you don't believe in Nvidia" — a nod to the chipmaker's escalating stake, which rose through rounds in September 2025, April 2026 and August 2026 that took Firmus from a $1.85 billion valuation to roughly $15 billion in little more than a year before the IPO sought to nearly triple it again.

Timing compounded the damage. Days before the bookbuild closed, CDC Data Centres confirmed it had abandoned its Project Southgate partnership with Firmus — a venture announced in 2025 at a $73 billion price tag targeting 1.6 gigawatts of capacity that had delivered only a fraction of that build-out. Rising US Treasury yields, which pushed past 5% on the 10-year in late September, also raised the implied cost of debt-financing further gigawatts of data center capacity, a concern echoing through AI infrastructure credit more broadly this year.

A read on the Asia-Pacific AI IPO pipeline

Firmus said it will instead raise private capital, likely from existing backers such as Nvidia, Blackstone and Coatue Management, and is weighing other public listing venues including a possible US exchange. For other AI infrastructure companies eyeing public markets across Asia-Pacific, the withdrawal sets a tougher bar: investors are now demanding evidence of contracted revenue actually converting to cash, not just gigawatts on a roadmap. With roughly 42-58% of Firmus's float subject to limited post-listing lockups and short-sellers reportedly positioned to act, the deal's structure left little room for anything short of overwhelming demand — demand that did not materialize.