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SLB to Acquire Kelvion for $3.4 Billion to Expand Data Center Cooling Business

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Oilfield services firm SLB (SLB) said on Monday it had signed an agreement to acquire thermal management specialist Kelvion for about $3.4 billion in cash.

SLB will also assume about $700 million of Kelvion's debt, valuing the transaction at about $4.1 billion.

The deal, which is projected to close in H1 2027, will strengthen SLB's Data Center Solutions business with cooling and heat-exchange technologies that are increasingly critical as AI systems require more power and generate more heat.

Kelvion, which has been majority-owned by Apollo-managed funds with a minority stake held by funds advised by Triton, is expected to generate about $2.3 billion to $2.4 billion in revenue and $350 million to $400 million in adjusted EBITDA in 2026.

SLB said the transaction would more than double its revenue opportunity per gigawatt of data center capacity delivered and broaden its offering to customers seeking integrated infrastructure solutions.

The company's Data Center Solutions business is projected to have grown revenue at a compound annual rate of over 90% between 2024 and 2026, with cumulative delivered capacity expected to exceed 2 gigawatts by the end of this year.

The acquisition is expected to generate about $120 million in annual EBITDA cost savings within three years, through cost savings and additional revenue opportunities.

SLB expects the deal to add to earnings per share and free cash flow per share within the first 12 months after closing.

On a pro forma basis, SLB and Kelvion would have generated more than $2 billion in data center revenue and about $300 million in adjusted EBITDA in 2026, the company said.

SLB is targeting $4.5 billion to $5 billion in revenue and $700 million to $800 million in adjusted EBITDA for its combined data center solutions business in 2028.

Kelvion's broader portfolio includes heat exchangers and thermal management systems for energy and industrial applications, such as heat pumps, renewable energy, and carbon capture and processing.

Price: $58.94, Change: $+1.61, Percent Change: +2.80%

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Commodities

US Natural Gas Prices Rise for 3rd Straight Week on Bullish Storage, Weather Momentum

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$BKR
Commodities

Market Chatter: Pentagon Weighs Venezuela Oil Partnership Covering 17 Fields

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Commodities

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