Firmus datacentre valuation drops as ASX listing plans postponed

Australian AI datacentre operator Firmus Technologies is scaling back its share price or pausing its stock market debut. Investor caution has overridden earlier enthusiasm for the ASX listing, which was projected as the largest in decades.

The firm’s market value surged rapidly. It moved from less than $2bn to $15bn about eight weeks ago. The price then jumped to almost $44bn just days before launch. Weak demand forced a sudden re-evaluation. The company withdrew its listing plans for the ASX on Thursday.

“The whole thing was getting fanciful,” an investment manager briefed on the float said. The company currently runs two operational sites. It holds contracts for seven facilities with four more planned. Approximately 97% of its contracted revenue depends on sites that have not yet been constructed. Investors noted the business loses hundreds of millions of dollars while its valuation climbs continuously.

Firmus relies on a pipeline of unbuilt projects to justify its current price tag. “You only get near the offer price if delivery, financing and renewals all go to plan,” said Armina Rosenberg, co-founder of Minotaur Capital. The company is targeting Asian markets to sidestep local opposition. Those regions present their own barriers, including power grid limits and extended construction timelines. The valuation assumes sustained heavy spending from major tech firms like Microsoft, Google, and Meta. A slowdown in hyperscaler spending could disproportionately impact third-party datacentre operators.

Morningstar analyst Lochlan Halloway noted that market sentiment has entered a euphoric phase. The risk remains the steep price investors would pay. The initial public offering was scheduled for 23 October with shares priced at $11. The company will now either reduce that price significantly or pull the listing entirely.