AirTrunk nears $1B Johor data centre sale amid market selloff

Source published 2h 35m agoTerminal published 2h 33m ago

Summary

A recent market selloff and rising interest rates are challenging companies involved in the global AI infrastructure boom, leading to delays in fundraising and increased borrowing costs. Investors are now more cautious, seeking proof that these companies can generate sustainable returns amidst soaring costs for computing power and energy. Many planned equity listings, such as those by Firmus, have been paused as valuations come under scrutiny, although merger and acquisition activity in the Asian data center sector remains robust, with $21.3 billion in deals already this year, more than double the total from all of 2025. As investors shift their focus towards distinguishing established operators with stable revenues from higher-risk AI developers, deal-making is expected to continue, albeit with heightened caution regarding valuations and execution risks.

Analysis

Bain: Bain Capital is a global private equity firm active in technology and infrastructure investments across Asia and other regions. In the current market environment, the firm is advancing the sale of a significant stake in its Bridge Data Centres platform to interested bidders. This transaction proceeds amid broader scrutiny of data centre valuations and business models. AirTrunk: AirTrunk is an Asia-Pacific focused data centre operator backed by Blackstone. The company is close to completing the sale of its Johor facility in Malaysia to a group of investors including the local pension fund KWAP, following the postponement of its planned REIT listing. These moves highlight shifting investor priorities toward execution and revenue stability in AI infrastructure. CoreWeave: CoreWeave is a data centre operator specializing in supporting AI workloads. Its debt securities have come under pressure and approached distressed levels during the recent market selloff in AI-related assets. The development underscores investor concerns over borrowing costs and long-term returns in the sector. Harry Evans: Harry Evans is a partner at the law firm Freshfields with expertise in deal-making. He observed that investor discussions have moved from unchecked growth to a sharper emphasis on business quality and execution risk in data centre transactions. Evans noted that a robust deal pipeline could sustain activity into the following year. Nicholas Tuan: Nicholas Tuan serves as director of APAC Advisory Services at real estate firm Savills. He highlighted that sector IPOs often rely on hype and oversubscription rather than proven asset fundamentals. Tuan's comments reflect increased caution among investors evaluating data centre offerings. Deal Activity: M&A in the Asian data centre sector continues at a strong pace despite setbacks in equity listings and REIT plans. Investor Focus: Capital providers are increasingly differentiating between established operators with stable contracts and higher-risk AI-focused developers. Market Conditions: A broad market selloff and rising interest rates are prompting investors to demand clearer proof of sustainable returns from AI infrastructure spending.

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