Schneider Electric to invest $850m in Motivair acquisition
Schneider Electric's recent announcement details a planned investment of $850 million in the acquisition of Motivair, a company specializing in data center cooling solutions. The acquisition is aimed at strengthening Schneider's presence in the data center market, particularly in the area of liquid cooling for high-performance computing.
The company intends to purchase the remaining 25% non-controlling interests in Motivair by 2028, integrating it into Schneider Electric’s Energy Management business segment. However, the completion of the transaction is contingent upon customary closing conditions, including regulatory approvals, and is anticipated to finalize in the coming quarters.
As part of the deal, Schneider Electric will initially acquire a 75% controlling interest in Motivair for $850 million in cash, valuing Motivair at a mid-single digit multiple of projected financial year 2025 revenue, including the value of a tax step-up.
Industry experts have highlighted artificial intelligence and the emergence of large language models as key factors driving the increased power generation required to support the expanding digitization across diverse markets.
Data center services have assumed greater importance in the global economy, with approximately 20% of global data center storage capacity now dedicated to AI, as reported by Whiteshield and Khazna.
Schneider Electric emphasized that the shift towards accelerated computing has led to the development of new data center architectures that necessitate more efficient cooling solutions. According to the company, traditional air cooling systems are no longer sufficient to manage the heightened heat produced by advanced computing systems, underscoring the need for a transition to liquid cooling technologies.
Peter Herweck, the Chief Executive Officer of Schneider Electric, stated, “The acquisition of Motivair is a significant milestone, further solidifying our leading position across the data center value chain. Motivair’s unique liquid cooling portfolio complements our value proposition in data center cooling and enhances our prominent position in data center buildout from grid to chip and from chip to chiller.”
Motivair, based in Buffalo, New York, was established in 1988 and has a workforce of over 150 employees. Leveraging its robust engineering expertise and deep domain knowledge, Motivair delivers top-notch products, including coolant distribution units, rear door heat exchangers, cold plates, and heat dissipation units, as well as chillers for thermal management.
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