CyrusOne eyes $5B IPO in 2027 as AI data center deals surge

CyrusOne, the data center operator owned by KKR and BlackRock's Global Infrastructure Partners, is preparing for an initial public offering as early as 2027 that could raise roughly $5 billion, according to sources familiar with the matter. Goldman Sachs and Morgan Stanley pitched for roles on the deal last week, signaling that underwriters see the listing as one of the sector's biggest in years.

The company has not settled on a target valuation or the size of the raise, and sources caution the discussions remain at an early stage. Still, the move places CyrusOne at the front of a crowded pipeline of AI-linked infrastructure deals competing for public market capital.

Why the owners are heading for an exit

KKR and GIP took CyrusOne private in 2022 in a deal valued at about $15 billion including debt. Three years later, the economics have shifted. AI training clusters demand dense power and cooling; hyperscalers are paying premiums for capacity that can come online fast. A public listing would let the private equity sponsors monetize their investment while giving CyrusOne fresh capital to pay down expansion debt.

CyrusOne operates more than 60 data center campuses across the United States, Europe, and Japan. That geographic spread matters: U.S. hyperscalers increasingly want redundancy outside a single region, and European data sovereignty rules favor local facilities.

A crowded IPO pipeline

CyrusOne is not alone. Switch, another data center operator, has already picked lead banks for an offering that could value the company near $80 billion including debt. SoftBank-backed SB Energy is preparing a U.S. IPO at a potential valuation above $50 billion. Brookfield-backed Csquare raised more than $1 billion in its listing last month.

The common thread is AI. Training large models requires thousands of GPUs running around the clock, and inference at scale is not much lighter. Cloud providers cannot build capacity fast enough in-house, so they lease from specialists. That demand has turned data center operators into infrastructure bets on the AI buildout itself.

KKR doubles down on the buildout

The timing aligns with KKR's broader infrastructure push. The firm raised a record $19.2 billion for its latest infrastructure fund this month. In June it launched Helix Digital Infrastructure, a new vehicle with more than $10 billion in committed capital earmarked specifically for AI-related data center financing.

An IPO would not necessarily mean a full exit. Private equity sponsors often retain stakes after listings, and CyrusOne's debt load gives them reason to keep the company well capitalized. But public market access would diversify funding sources and reduce reliance on private credit at a time when rates remain elevated.

What remains uncertain

BlackRock, KKR, Goldman Sachs, and Morgan Stanley all declined to comment. CyrusOne itself offered no statement. The Information previously reported that the company was preparing to interview banks, so last week's meetings mark progress rather than a fresh development.

Details that matter most, including final valuation, share structure, and use of proceeds, remain undecided. A $5 billion raise is a placeholder floated by one source, not a target the company has confirmed. Between now and 2027, market conditions, AI spending trends, and interest rates could all shift the calculus.

For CTOs evaluating colocation or cloud commitments, the pipeline of IPOs signals that capacity is coming, but so is capital discipline. Operators raising public equity will face quarterly scrutiny on returns. That could mean tighter pricing for new leases and less willingness to overbuild speculatively.

Source: Tech-Economic Times / ET