Firmus reportedly cuts valuation as planned ASX flotation faces doubt

Firmus Technologies is cutting its proposed valuation to attract investors and could shelve its planned Australian Securities Exchange flotation, Guardian Australia reported on 8 October. The reported change puts its anticipated 23 October debut in doubt as prospective shareholders question the price of an AI infrastructure business whose expansion depends heavily on facilities still to be built.

Citing multiple sources briefed on the flotation, the Guardian said a valuation approaching A$44 billion was being reduced after weak investor support. It reported no replacement share price, final revised valuation or alternative listing date. A cancellation remains a possibility described by those sources, rather than an announced company decision.

The Guardian said it had contacted Firmus for comment but included no company response to the repricing report. It also reported that Firmus withdrew from a scheduled parliamentary inquiry appearance on Thursday, 8 October, amid discussions over the flotation; it did not provide a company explanation for that withdrawal.

How Firmus’s flotation prospects changed

The latest account contrasts with terms reported by Reuters on 2 October. A term sheet seen by the news agency priced shares at A$11 each, implying an equity valuation of US$30.6 billion, nearly triple the US$10.5 billion valuation following an August fundraising round. The Australian-dollar and US-dollar figures describe the proposed company valuation, not the cash to be raised.

Investor reservations were already visible in Reuters’s interviews. Merlon Capital Partners portfolio manager Kirit Hara said his firm struggled to justify a market capitalisation above A$40 billion from Firmus’s operating and development assets. His concern was whether the assets and growth plans supported the price being sought.

Blackwattle Investment Partners portfolio manager Joseph Koh told Reuters his firm would not bid because it lacked confidence in delivery of future projects and, consequently, the valuation dependent on them. Katana Asset Management’s Romano Sala Tenna was undecided, saying: “We are struggling with the fundamental arithmetic”. Firmus declined to comment for that earlier Reuters report.

Why unfinished AI facilities matter to the valuation

Firmus builds and operates liquid-cooled AI facilities equipped with Nvidia graphics processing units. The Guardian described two small operational sites, alongside seven contracted and four planned facilities. Contracted and planned capacity should not be confused with infrastructure already operating; the reported categories do not establish a single total of distinct sites.

About 97% of contracted revenue relates to sites not yet built, Minotaur Capital co-founder Armina Rosenberg told the Guardian. Her assessment concerns contracted future business, rather than revenue already being earned. It places construction and delivery at the centre of the debate over how much prospective shareholders should pay.

“You only get near the offer price if delivery, financing and renewals all go to plan,” Rosenberg said. She identified power constraints and construction times among the hurdles to expansion in Asia. Those are risks to executing the growth plan, rather than evidence that a particular project has already failed.

Reuters separately reported Firmus’s forecast of roughly US$5 billion in annual earnings within five years, based on existing facilities in Melbourne and Singapore and five planned centres. That was a company projection, not realised earnings. Reuters’s earlier description of planned centres and the Guardian’s newer facility categories do not provide a reconciled construction inventory.

August financing set out Firmus’s expansion plans

In its 7 August financing announcement, Firmus said it had received full commitments for a US$2 billion strategic equity round. Returning investors included Coatue and Nvidia, with participation from Blackstone funds and Jane Street. The company said the transaction brought new equity raised over the preceding year above US$3 billion and its post-money valuation above US$10.5 billion.

Firmus said the capital would accelerate its Project Southgate rollout in Australia and preparations for expansion elsewhere in Asia-Pacific. Co-chief executive Oliver Curtis linked the investment to early work on an announced Indonesia development. Those statements describe the purpose of the August funding, rather than a new October financing agreement.

Blackstone senior managing director John Watson said in that announcement that AI infrastructure was among the firm’s highest-conviction investment themes. That earlier rationale explains its participation in the financing round; it is not a response to the reported repricing. Neither a revised offer price nor a confirmed change to the listing timetable is established by the Guardian’s latest report.