SLB Acquires Kelvion for $3.4B to Boost Data Center Cooling

In a significant move to capture the escalating demand for advanced data center infrastructure, SLB has agreed to acquire Kelvion, a long-established global leader in thermal management solutions, for approximately $3.4 billion in cash. This strategic acquisition, which also includes assuming about $0.7 billion in debt, positions SLB as a more integrated technology partner for the rapidly expanding data center sector, particularly driven by artificial intelligence workloads.

The deal, signed on August 31st, underscores SLB's commitment to accelerating its presence in the digital infrastructure space. Olivier Le Peuch, CEO of SLB, highlighted that AI is catalyzing an unprecedented infrastructure investment cycle. By integrating Kelvion's expertise, SLB aims to enhance its offerings for data centers, significantly expanding its addressable market and more than doubling its revenue potential per gigawatt of delivered capacity. This acquisition is expected to be accretive to SLB's earnings per share and free cash flow within the first year post-closing.

Kelvion, with over a century of operational history, brings a robust portfolio of heat exchange and thermal management technologies. The company is strategically positioned at the confluence of two powerful growth trends: the build-out of AI infrastructure and the global energy transition. Projected to generate between $2.3 billion and $2.4 billion in revenue for 2026, Kelvion's data center segment already represents its largest and fastest-growing division, with anticipated revenues of $1.2 billion to $1.3 billion in the same year. Beyond data centers, Kelvion holds strong positions in critical areas like heat pumps, renewable energy systems, and carbon capture technologies, all of which rely heavily on efficient thermal management.

SLB's own Data Center Solutions business has experienced remarkable growth, with revenue on a trajectory for a compound annual growth rate exceeding 90% between 2024 and 2026. The company anticipates its delivered capacity to surpass 2 gigawatts by the end of this year. SLB's modular construction and integrated engineering approach aims to streamline data center development, potentially reducing onsite construction complexities and accelerating deployment timelines by up to 40%. The integration of Kelvion's cooling capabilities is expected to further enhance this offering, allowing for more sophisticated and efficient system designs.

The acquisition from Apollo-managed funds, the majority owner, and Triton, a minority stakeholder, values Kelvion at approximately 11 times its estimated 2026 EBITDA before synergies. Including anticipated annual run-rate synergies of around $120 million within three years, the multiple adjusts to roughly 8.5 times. These synergies are expected to stem from both cost efficiencies and incremental revenue opportunities. On a combined basis, SLB and Kelvion are projected to achieve over $2 billion in data center revenue and approximately $300 million in adjusted EBITDA in 2026, with SLB targeting $4.5 billion to $5 billion in revenue and $700 million to $800 million in adjusted EBITDA for its consolidated data center solutions business by 2028.

This move by SLB aligns with a broader industry trend where established industrial and infrastructure players are actively acquiring specialized cooling technology providers to address the immense power and heat generated by modern AI hardware. Competitors like Vertiv, Schneider Electric, and Trane Technologies have also made strategic acquisitions in the liquid cooling and thermal management space, signaling a significant shift in how data center infrastructure is being developed and managed. The transaction is anticipated to close in the first half of 2027, subject to regulatory approvals.