Sydney — Australian data center operator Firmus is preparing to launch an initial public offering on October 6 that could raise A$7 billion, equivalent to $5 billion, according to a term sheet reviewed by Reuters.

If completed at that size, the offering would rank as the second-largest IPO in Australia’s history, behind Telstra’s $10 billion listing in 1997.

The institutional bookbuild is due to start on October 6 and finish on October 7. Firmus is expected to lodge its prospectus on October 8, with retail investors scheduled to bid for shares from October 12 through October 19.

Trading on the Australian Securities Exchange is set to begin on October 22.

Firmus could raise up to $5.5 billion if an over-allotment option, commonly known as a greenshoe, is exercised. That option could add another $500 million to the proceeds.

The company was founded in 2019 by Oliver Curtis, Tim Rosenfield and Jonathan Levee. Shares held by the founders will be subject to escrow arrangements after the listing. Under terms described in an investor presentation reviewed by Reuters, 10% of their shares would be released after one year, followed by another 39.9% after two years.

According to Dealogic data, the IPO would rank as the fourth-largest globally so far this year.

Firmus operates data centers that provide computing infrastructure for artificial intelligence and other digital services. The company currently has two operational facilities in Australia and Singapore, while another five are being developed across the Asia-Pacific region.

The planned listing comes as companies and investors continue to increase spending on infrastructure intended to meet rising demand for AI computing capacity.

The scale of that investment has raised questions about whether the spending required to build data centers can remain sustainable over the long term. Some industry leaders have also questioned whether the rapid development of AI models and the associated infrastructure investment can continue at its current pace indefinitely.

Data center developments have additionally encountered growing opposition from local communities over their use of electricity and water. Firmus has faced resistance to some of its proposed projects in Australia.

The IPO is therefore set to offer a closely watched indication of investor demand for data center operators and the infrastructure required to support AI.

Its timing also puts Firmus among a growing number of companies turning to public markets as investors evaluate the size and durability of the current AI investment cycle.

Firmus declined to comment on the IPO plans.

The exchange rate cited in the term sheet was $1 to 1.4029 Australian dollars. The proposed timetable remains subject to applicable listing and capital-markets processes.

Original article