❯ Nvidia-backed Firmus withdraws its roughly $5 billion Australian IPO and turns to private markets

The board pulls the offerAustralian AI data center operator Firmus has withdrawn its planned listing. In a statement to CNBC, the company said its board determined that the proposed offering terms did not adequately reflect the strength of its business and long-term growth outlook and that proceeding was not in the best interests of the company and its shareholders, also citing market volatility. Firmus said it will pursue capital from private markets and consider other public and private options.

It would have been Australia's second-largestFirmus had reportedly planned to price shares at A$11 and raise about $5 billion, implying a valuation of about $30.6 billion. By size of new shares sold, it would have been the second-largest in Australian history.

Nearly triple in two monthsIn August, Firmus announced a $2 billion round backed by Nvidia, Coatue, Blackstone and Jane Street, bringing equity raised over the preceding year to more than $3 billion and its valuation to over $10.5 billion. The IPO price implied nearly three times that. Last month the company also announced agreements with Meta to provide GPU capacity at its AI data centers in Southeast Asia.

Same investors, two outcomesBlackstone and Coatue are leading Lambda’s private round this week while watching Firmus, which they also backed, pull out of the public market. Private investors are willing to price compute companies on long-term contracts; public buyers this time did not accept the price Firmus proposed. Peers preparing to list next year will use this withdrawal as a reference when setting their own terms.

▮ SIGNALCompute companies have grown more expensive with every private round, and only at the door of the public market did they first meet buyers unwilling to pay the asking price.