Nvidia-backed AI firm Firmus cancels historic $5B IPO

Australia's Firmus, an AI data centre operator backed by Nvidia, has abandoned its planned $5 billion initial public offering, citing market uncertainty and conditions. The company announced it will pursue private fundraising instead, stating the IPO terms did not accurately reflect its business value and long-term growth prospects.

Firmus had aimed to sell shares at A$11 each, valuing the firm at $30.6 billion, nearly triple its valuation of $10.5 billion following an August fundraising round. The issuer, which plans to build five more data centers across the Asia-Pacific region, had a draft prospectus that projected $5 billion in annual earnings from data centers within five years.

Despite the valuation hike, investors expressed concerns due to the company's limited operational history and the high expectations placed on future performance. Firmus, with $30 billion in debt, had an enterprise value of $60 billion, surpassing some long-established Australian companies. The decision to pull the IPO reflects a growing focus among investors on the economic viability of AI investments and the risks associated with infrastructure spending.