SLB to Acquire Kelvion, Expanding Data Center Infrastructure Footprint
SLB sits 85% above its 52-week low of $31.64.
Summary
SLB is acquiring Kelvion for about $3.4 billion in cash from majority owner Apollo and funds advised by Triton. SLB will assume about $700 million of Kelvion debt. Kelvion provides thermal management and heat exchange technologies, and the acquisition strengthens SLB's data center solutions business. SLB expects the deal to generate about $120 million in annual EBITDA synergies within three years. The acquisition expands SLB's role in data center infrastructure and follows a July strategic alliance with Liberty Energy targeting the same sector. SLB expects the deal to close in the first half of 2027 and targets 2028 combined data center revenue of $4.5B-$5B with adjusted EBITDA of $700M-$800M. Kelvion 2026 revenue is expected to be $2.3 billion to $2.4 billion, with adjusted EBITDA of $350 million to $400 million and data center revenue of $1.2 billion to $1.3 billion. SLB's Data Center Solutions revenue CAGR is expected to exceed 90% between 2024 and 2026, and delivered capacity is expected to surpass 2 gigawatts cumulatively by end of 2026. The transaction value is about 11x estimated 2026 EBITDA before synergies and about 8.5x including run-rate synergies, and is expected to be accretive to EPS and free cash flow per share in the first 12 months. Combined SLB and Kelvion 2026 pro-forma data center revenue is expected to exceed $2 billion, with pro-forma adjusted EBITDA of $300 million. SLB expects to retain a strong investment-grade balance sheet with net debt-to-EBITDA ratio up to 1.5x. The acquisition more than doubles SLB's revenue opportunity per gigawatt of delivered capacity. Kelvion is positioned at the intersection of AI infrastructure and energy system transformation growth trends, with established positions in heat pumps, renewables, carbon capture and processing solutions. The transaction is subject to customary closing conditions and regulatory approvals.
Updated with an SEC 8-K filing · What changed
Updates
· SEC 8-K — SLB expects the deal to close in the first half of 2027 and targets 2028 combined data center revenue of $4.5B-$5B with adjusted EBITDA of $700M-$800M.
- Kelvion Financials — Kelvion 2026 revenue is expected to be $2.3 billion to $2.4 billion, adjusted EBITDA $350 million to $400 million, and data center revenue $1.2 billion to $1.3 billion.
- SLB Data Center Growth — SLB's Data Center Solutions revenue CAGR is expected to exceed 90% between 2024 and 2026, and delivered capacity is expected to surpass 2 gigawatts cumulatively by end of 2026.
- Valuation — Transaction value is about 11x estimated 2026 EBITDA before synergies and about 8.5x including run-rate synergies.
- Accretion — Transaction expected to be accretive to EPS and free cash flow per share in first 12 months.
- Closing Conditions — Transaction is subject to customary closing conditions and regulatory approvals.
- Pro-Forma Data Center — Combined SLB and Kelvion 2026 pro-forma data center revenue expected to exceed $2 billion, with pro-forma adjusted EBITDA of $300 million.
- Balance Sheet — SLB expects to retain strong investment-grade balance sheet with net debt-to-EBITDA ratio up to 1.5x.
- Revenue Opportunity — Acquisition more than doubles SLB's revenue opportunity per gigawatt of delivered capacity.
- Kelvion Positioning — Kelvion is positioned at the intersection of AI infrastructure and energy system transformation growth trends, with established positions in heat pumps, renewables, carbon capture and processing solutions.
All 15 details
- Kelvion 2026 revenue expected to be $2.3 billion to $2.4 billion.
- Kelvion 2026 adjusted EBITDA expected to be $350 million to $400 million.
- Kelvion's 2026 data center revenue expected to be $1.2 billion to $1.3 billion.
- SLB's Data Center Solutions revenue CAGR expected to exceed 90% between 2024 and 2026.
- SLB's Data Center Solutions delivered capacity expected to surpass 2 gigawatts cumulatively by end of 2026.
- Transaction value is about 11x estimated 2026 EBITDA before synergies.
- Transaction value is about 8.5x estimated 2026 EBITDA including run-rate synergies.
- Transaction expected to be accretive to EPS and free cash flow per share in first 12 months.
- Transaction is subject to customary closing conditions and regulatory approvals.
- Combined SLB and Kelvion 2026 pro-forma data center revenue expected to exceed $2 billion.
- Combined SLB and Kelvion 2026 pro-forma adjusted EBITDA expected to be $300 million.
- SLB expects to retain strong investment-grade balance sheet with net debt-to-EBITDA ratio up to 1.5x.
- Acquisition more than doubles SLB's revenue opportunity per gigawatt of delivered capacity.
- Kelvion is positioned at the intersection of AI infrastructure and energy system transformation growth trends.
- Kelvion has established positions in heat pumps, renewables, carbon capture and processing solutions.
At the time of this announcement, SLB was trading at $58.42 on NYSE in the Energy & Transportation sector, with a market capitalization of approximately $85.1B. The 52-week trading range was $31.64 to $58.82. This news item was assessed with positive market sentiment and an importance score of 9 out of 10. Source: Dow Jones Newswires.