Search our blog for articles and insights right here, just type your interest and dive into a world of knowledge.
Popular articles
Northern Data AG Eyes US IPO for AI Cloud Computing and Data Center Units
Northern Data AG is exploring a potential US initial public offering (IPO) for its combined artificial intelligence (AI) cloud computing and data center operations. The IPO could value the company at up to $16 billion, sources familiar with the situation revealed. The company has invited several advisers to pitch for a potential role in the IPO, with the aim of appointing lead banks in the upcoming months.
Under the current plan, Northern Data intends to list its unified cloud computing and data center businesses on Nasdaq, potentially as early as the first half of next year. The entity would comprise of its cloud computing unit, Taiga, and its data centers, Ardent. Banks have suggested valuations ranging from $10 billion to $16 billion for this combined unit. Additionally, Northern Data is considering selling a minority stake in the unit to investors before the IPO.
Deliberations are still in progress and details could change. The company may decide against proceeding with the IPO and other strategic options on the table. Northern Data representatives declined to comment on the matter. This year, shares of Northern Data have decreased by about 5%, placing its market value at approximately €1.3 billion ($1.4 billion). The Frankfurt-based company went public in 2018.
The move to pursue an IPO comes at a time when cloud computing firms involved in AI are attracting significant investment. CoreWeave Inc., a private cloud computing provider, recently raised $8.6 billion in funding, including a $1.1 billion preferred equity investment, which valued the startup at $19.1 billion.
Previously, Northern Data had considered an IPO solely for its cloud unit and a separate US listing for its Bitcoin mining operations. Its US Bitcoin mining unit, Peak Mining, has data centers with nearly 700 megawatts under construction or development, poised to become one of the largest crypto miners in the US. Due to thinning profit margins in crypto mining, these miners are shifting their data centers to support AI applications, leveraging their expertise in running graphics processing unit-based operations to gain an edge over traditional data center operators.
The crypto industry has seen several companies striving for public listings face challenges. Stablecoin issuer Circle and digital-asset exchange Kraken have encountered regulatory headwinds. The US Securities and Exchange Commission has clashed with Kraken over alleged operation of an unlicensed exchange, which Kraken disputes, and the regulatory status of stablecoins remains uncertain.
In 2022, Northern Data was a major Ether miner, dedicating around 70% of its operations to it. However, following an Ethereum blockchain update, the company shifted focus to other business areas, including high-performance computing. In November, Northern Data secured a €575 million debt-financing facility from stablecoin firm Tether Group. Additionally, in January, it completed the acquisition of a vehicle from Tether valued at €400 million, establishing Tether as a cornerstone investor in Northern Data.
The funds from these deals are being utilized for the purchase of advanced Nvidia Corp. chips. The company plans to deploy about 20,000 H100s, one of Nvidia's most advanced AI chips, by the end of the summer.
