SLB has announced a significant acquisition of thermal management company Kelvion for $4.1 billion, a move aimed at expanding its data center operations to meet the growing demands from artificial intelligence (AI) workloads. The deal is poised to enhance SLB’s capabilities in cooling and heat rejection technologies, critical as AI applications continue to increase power densities in data centers.
With the acquisition, SLB will acquire essential technologies including heat exchangers and cooling solutions, enhancing their suite of engineering, modular manufacturing, and digital services. This strategic merger is anticipated to double SLB’s revenue potential per gigawatt of data center capacity, projecting over $2 billion in revenue for the combined data center business in 2026, with ambitions to reach between $4.5 billion and $5 billion by 2028.
As emphasized by experts, the acquisition is not simply about expanding SLB’s current offerings but about positioning the company for future growth in a rapidly evolving market. Historically a minor player in the data center landscape, SLB is expected to leverage Kelvion’s expertise to become a major original equipment manufacturer (OEM) in the thermal management field.
The data center solutions segment within SLB has seen remarkable growth, boasting over 90% in compound annual growth rate from 2024 to 2026. By the year’s end, it’s expected that SLB will exceed 2 gigawatts of delivered capacity. Kelvion, which projects 2026 revenues of $2.3 billion, brings valuable data center business revenue of approximately $1.2 billion to $1.3 billion to SLB.
A critical focus in the AI industry has been on direct-to-chip cooling methods. However, as thermal management is essential from the chip through to the cooling solutions, Kelvion strengthens SLB’s position in this sector. With modern GPUs increasing rack densities beyond 100 kW, SLB’s integration of Kelvion is a timely enhancement, especially as it aligns with trends towards waterless cooling solutions amid rising environmental concerns.
Moving forward, SLB aims to incorporate Kelvion’s technologies directly into its modular infrastructure, streamlining the cooling process during the design phase rather than treating it as an afterthought. The company exemplifies this by its work with Nvidia AI factories, which will benefit from Kelvion’s thermal expertise for improved efficiencies in cooling systems.
Contemplating future growth, SLB sees potential in a broader infrastructure strategy that intertwines thermal management with power generation solutions. This aligns with the increasing need for data centers to become energy self-sufficient, a focus SLB anticipates will lead to integrated offers combining power, cooling, and modular infrastructure.
The scope of the market opportunity is substantial, with SLB projecting that it could address a data center infrastructure market exceeding $150 billion by 2030, significantly expanding its geographical footprint beyond the U.S. to Europe, Asia, and the Middle East.
Financially, SLB’s acquisition strategy includes approximately $3.4 billion in cash and assuming around $700 million of Kelvion’s debt, which positions the deal at an estimated value of 11 times its projected 2026 adjusted EBITDA. The planned synergies from this merger are expected to yield about $120 million annually within three years, predominantly from cost savings and revenue creation from Kelvion’s technologies.
In summary, SLB’s acquisition of Kelvion represents a pivotal step towards bolstering its data center capabilities amid growing AI demands. As the company integrates the thermal management expertise into its broader strategy, it aims to navigate the evolving landscape of data center infrastructure effectively.
Welcome to DediRock, your trusted partner in high-performance hosting solutions. At DediRock, we specialize in providing dedicated servers, VPS hosting, and cloud services tailored to meet the unique needs of businesses and individuals alike. Our mission is to deliver reliable, scalable, and secure hosting solutions that empower our clients to achieve their digital goals. With a commitment to exceptional customer support, cutting-edge technology, and robust infrastructure, DediRock stands out as a leader in the hosting industry. Join us and experience the difference that dedicated service and unwavering reliability can make for your online presence. Launch our website.