Major share market float of Firmus in trouble as interest wanes
The company is reportedly having to price its shares lower as it closed its books to potential investors abruptly overnight.
The $44 billion Australian flotation of data centre operator Firmus is facing trouble as interest wanes. The initial public offering (IPO) was touted as the biggest since Telstra in the 1990s, but reports indicate the share offering may be re-priced downwards. Firmus was set to list on the Australian Securities Exchange (ASX) at $11 per share, but some believe the price may have been set too high.
Market participants have shown little enthusiasm for the float, with some criticizing it for lacking detail and others expressing concerns over its debt and energy needs. The company's representatives have pulled out of a parliamentary inquiry into artificial intelligence, suggesting a possible connection to the IPO troubles. Firmus is a neocloud technology company that builds, owns, and operates upscale data centres, or "AI factories," used to run and train artificial intelligence models.
The firm aims to raise up to $7 billion from institutional and retail investors, potentially valuing the company at over $50 billion. However, concerns over a $73 billion partnership with data centre firm CDC and community backlash for proposed suburban data centres have raised red flags for investors. Firmus co-founder Oliver Curtis was jailed for 12 months in 2016 for insider trading.
Analysts have expressed concerns over the company's high valuation, excessive debt, and lack of transparency.
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