Firmus Technologies has pulled its IPO, abandoning what would have been the biggest ASX listing since Telstra in 1997. The $44bn float was meant to raise US$5.5bn at $11 a share to fund its data centre buildout across Asia and Australia.
The deal unravelled in less than a week. On Monday, US banks JPMorgan, Bank of America and Morgan Stanley, alongside local broker Morgans, told fund managers bids were well in excess of the shares on offer. By Thursday the book had closed short, with the large US investors expected to anchor the deal failing to show. Repricing talks slid from $11 towards $8 and below before Firmus walked away on Friday. Investors walked away for five reasons:
Unproven business: Most of Firmus’ forecast earnings relied on data centres not yet built, keeping super funds such as UniSuper and Aware Super out.
Loose escrow: More than half the register was free to sell on listing, raising the risk of early backers cashing out and sinking the share price.
Late surprises: The end of a partnership with CDC Data Centres and a new Meta deal were disclosed on the eve of the book build, as Firmus changed strategy from tenant to data centre owner.
US no-shows: American fund managers familiar with listed peers such as CoreWeave failed to bid at the size the banks had promised, with bankers having massively overestimated demand.
AI jitters: AI stocks slumped after OpenAI reported revenue below expectations, cooling appetite for the sector.
The blame is now landing on the bankers, who stood to earn about $215m in fees. Longstanding backer David Paradice said his firm had been told of massive US bids “which clearly never eventuated”, and commentators are calling on ASIC to examine the brokers’ messaging. The damage has already spread to the ASX, with contractor Maas Group, a major Firmus shareholder, shedding $550m in value on Thursday.
The bigger cost may fall on Firmus’ founders. Under deal protection clauses agreed in July with US chipmaker Nvidia, private equity giant Blackstone and other backers, missing a November 30 listing deadline hands those investors extra shares the longer the delay runs, diluting founders and early investors.
Firmus will now seek private funding and pursue a Nasdaq listing. Last week its CFO called a US listing “something that we’d be thinking about”. This week it became the plan.
