Schneider Electric to acquire Motivair for $850m

Schneider Electric has announced plans to invest $850m to acquire Motivair, a provider of data centre cooling solutions.

According to a statement posted on the company’s website on Thursday, it aimed to deepen its capabilities in the data centre market, particularly in liquid cooling solutions tailored for high-performance computing.

It added that it intended to acquire the last 25 per cent of non-controlling interests in Motivair by 2028 to integrate it into Schneider Electric’s Energy Management business segment.

However, the transaction is subject to customary closing conditions, including required regulatory approvals, and is expected to close in the coming quarters.

“Under the terms of the transaction, Schneider Electric will acquire an initial 75 per cent controlling interest in the equity of Motivair for an all-cash consideration of $850m, which includes the value of a tax step-up, and value Motivair at a mid-single digit multiple of projected financial year 2025 revenue,” the statement read.

According to experts, artificial intelligence and the introduction of large language models are key catalysts driving the increased power generation used to support the growing digitisation across various end markets.

Data centre services have become an increasingly important part of the world economy, with around 20 per cent of global data centre storage capacity being used for AI, according to a market report from Whiteshield and Khazna.

Schneider Electric said the shift toward accelerated computing led to new data centre architectures that required more efficient cooling solutions.

It added that traditional air cooling systems were proving inadequate for mitigating the higher heat generated by those advanced computing systems, necessitating a shift to liquid cooling technologies.

Schneider Electric Chief Executive Officer, Peter Herweck, commented, “The acquisition of Motivair represents an important step, furthering our world-leading position across the data centre value chain.

“The unique liquid cooling portfolio of Motivair complements our value proposition in data centre cooling and further strengthens our prominent position in data centre buildout from grid to chip and from chip to chiller.”

Motivair, headquartered in Buffalo, New York, was founded in 1988 and has over 150 employees.

It leverages its strong engineering competency and deep domain expertise.

Motivair’s world-class offers include coolant distribution units, rear door heat exchangers, cold plates, and heat dissipation units, alongside chillers for thermal management.

Motivair provides its customers with a top-tier portfolio to meet the thermal challenges of modern computing technology.

“Schneider Electric shares our core values and commitment to innovation, sustainability and excellence,” said the President and CEO of Motivair Corporation, Rich Whitmore, who will continue to run the Motivair business out of Buffalo, New York, after the closing of the transaction.

“Joining forces with Schneider will enable us to further scale our operations and invest in new technologies that will drive our mission forward and solidify our position as an industry leader. We are thrilled to embark on this exciting journey together.”