Northern Data Considers $16 Billion US IPO Amid AI and Data Center Expansion

• Northern Data AG, a German high-performance computing infrastructure firm, is assessing the possibility of a U.S. IPO for its AI cloud computing and data center units.
• According to Bloomberg News, the prospective IPO could value the combined entity at up to $16 billion.
• This strategic move comes amid an uptick in investor interest in AI technologies and a recover in the U.S. IPO market.

Discover the strategic movements of Northern Data AG as it explores a $16 billion IPO to capitalize on the burgeoning demand for AI technology and infrastructure.

Northern Data Considers U.S. IPO

Northern Data AG is evaluating the combination of its AI cloud computing unit, Taiga, and its data center operations, Ardent, with plans to list the new entity on the Nasdaq. This move could occur as early as the first half of 2025.

This strategic consideration is timely given the positive trends in the U.S. IPO market, driven by renewed investor confidence and a growing appetite for AI innovations, particularly after the success of OpenAI’s ChatGPT. The resurgence in IPO activities has prompted technology giants like Microsoft and Alphabet Inc. to make substantial investments in AI-supporting infrastructures.

The company has initiated discussions with potential advisors and intends to hire lead banks shortly. However, these plans are still under strategic review, and Northern Data may choose not to proceed with the IPO based on the outcome of these discussions.

Northern Data’s Market Position

Since its public debut in 2018, Northern Data has faced market volatility. This year, its shares have declined by approximately 5%, bringing its market capitalization to around €1.3 billion ($1.4 billion).

Responding to the reduced profitability of crypto mining, Northern Data has pivoted its energy-intensive data centers towards AI applications. In 2022, the company was a significant player in Ether mining, allocating over 70% of its operations to this activity. However, following the Ethereum blockchain upgrade, Northern Data refocused on high-performance computing and AI projects.

In November, the company secured a €575 million debt financing arrangement from Tether Group. Tether subsequently became a cornerstone investor, further solidifying this relationship with a €400 million purchase of a Tether-linked vehicle in January.

Notably, Northern Data is leveraging these funds to acquire advanced AI chips from Nvidia Corp., with plans to deploy approximately 20,000 H100 chips by the end of the summer.

Conclusion

In summary, Northern Data AG’s exploration of a U.S. IPO reflects its strategic repositioning towards AI technology amidst shifting market dynamics in crypto mining. The potential IPO, valued up to $16 billion, could place the company favorably in the robust and evolving AI sector. As the company advances its strategic conversations, investors and stakeholders should closely monitor these developments for further insights and opportunities.