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The capital journey of data centres: Navigating IPOs, M&A, and risk maturity

Explore the capital journey of data centres—from raising funds via IPOs to M&A growth and mastering risk maturity for long-term success and innovation.

07/11/2025 · 7 minute read

Behind the growth of data centres is a diverse mix of private equity firms, visionary founders, pension funds, sovereign wealth and infrastructure investors, and technology giants. These key players are enabling technological innovation while also embarking on capital journeys marked by rapid expansion, strong competition, and evolving market dynamics. Contact our experts to discuss how they can help support your business's future development.

Understanding the capital journey of data centres - from raising funds and completing strategic mergers and acquisitions (M&A) to managing risks with maturity - is essential for stakeholders aiming to realise opportunities while managing risks in this fast-evolving market.

IPO: Unlocking capital for expansion

For many data centre or technology companies, the initial public offering (IPO) marks a pivotal moment in their capital journey. Transitioning from private to public ownership can open access to vast pools of capital essential for funding large-scale investments and scaling operations. Given the capital-intensive nature of data centres — requiring significant outlays for land acquisition, construction, power infrastructure, and cutting-edge technology — IPOs are an attractive avenue to fuel growth and innovation.

One of the largest data centre IPOs in 2025 was by a real estate investment trust (REIT) focused on energy and data infrastructure, which launched on October 1. The dual-listed company on the Nasdaq and London Stock Exchange raised US$682.5 million and achieved a market valuation of approximately US$13.8 to US$15 billion, making it one of the largest IPOs in LSE history and a significant one for the AI infrastructure market.

Beyond capital, IPOs can enhance market visibility and credibility, attracting institutional investors who demand transparency, operational efficiency, and growth. This market discipline can drive companies to optimise capital deployment and innovate their service offerings. However, the IPO process also imposes regulatory and disclosure requirements that can constrain managerial flexibility and impact risk management strategies.

Mitigating D&O liability

Directors and officers of data centre companies face heightened personal liability risks, particularly in the high-stakes context of IPOs and public disclosures. Claims may arise from regulators, shareholders, and third parties alleging mismanagement or misrepresentation. Defending against allegations can be costly and reputationally damaging.

To mitigate these risks, companies should implement robust risk management strategies, including:

  • Comprehensive due diligence and verification of all public disclosures for the purposes of accuracy and completeness.
  • Corporate indemnification provisions that protect directors and officers from personal financial exposure.
  • D&O insurance policies tailored to the unique risks of the data centre sector, covering legal defence costs and potential settlements.
  • Ongoing director and officer education and governance best practices to maintain compliance with evolving regulatory standards.

M&A: Accelerating growth and market consolidation

While organic growth through new builds is fundamental, M&A activities have become a strategic lever in the data centre capital journey. Acquisitions enable companies to rapidly scale their footprint, enter new geographies, and diversify their service offerings without the lengthy timelines often associated with greenfield development.

M&A deals often bring multiple benefits by combining complementary technologies, customer bases, and operational expertise. For example, acquiring an edge computing provider can enhance a data centre’s ability to serve latency-sensitive applications by processing data closer to its source, reducing the time it takes for data to travel and be processed. Cost synergies from consolidated operations can improve margins, while expanded customer contracts may provide revenue stability. For example, a major cloud service provider acquired a 960-MW data centre campus in Pennsylvania for US$650 million, which will be directly powered by nearby nuclear energy, addressing both capacity needs and sustainability objectives.

Successful M&A requires careful valuation, due diligence, and planning to realise anticipated benefits while managing risks related to technology integration and regulatory approvals.

Risk maturity: The foundation of capital management

Underlying the capital journey lies risk maturity — the organisation’s ability to identify, assess, and manage a broad spectrum of risks effectively. Data centres face operational risks such as power failures, cybersecurity threats, and equipment failures, alongside financial risks including interest rate fluctuations and currency exposure, and regulatory risks.

A mature risk management framework can enable data centre stakeholders to make informed capital allocation decisions, balancing growth ambitions with resilience. For instance, understanding operational risks can guide investments in redundant power systems, protecting revenue streams and asset value.

Financial risk management, including hedging interest rate exposure or managing currency risks, helps stabilise capital costs and supports sustainable financing structures. Moreover, demonstrating robust risk governance can enhance investor confidence, facilitating access to capital on more favourable terms.

As the sector evolves, risk maturity will increasingly become a strategic differentiator and driver of long-term value creation.

Considerations for a successful capital journey

Achieving success in the data centre capital journey requires proactive attention to risk, compliance, and strategic planning. Key considerations include:

  • Capital intensity and long payback periods: Plan for substantial upfront investments and manage investor expectations around long-term returns.
  • Market volatility and competition: Stay attuned to rapid technological changes and competitive pressures that can influence demand forecasts, IPO pricing, and M&A valuations.
  • Integration risks in M&A: Conduct thorough due diligence to address technology incompatibility, operational continuity, personnel retention, and data security.
  • Regulatory and sustainability compliance: Proactively address energy consumption, carbon footprint, and evolving regulatory requirements to build investor trust.
  • Legal matters: Establish a judicious strategy that takes into account factors such as tax structuring, the regulatory environment, IP protection, and ongoing requirements and costs.
  • Comprehensive disclosure: Promote transparent, accurate prospectus documentation to mitigate legal risks and enhance governance credibility.
  • Investor expectations and reporting: Balance the pressure for quarterly performance with the long-term nature of infrastructure investments, communicating strategy clearly.

Balancing growth, risk, and innovation

The capital journey of data centres is a dynamic and multifaceted process involving the strategic raising of public capital through IPOs, accelerated growth via M&A, and the continuous evolution of risk maturity to manage operational and financial uncertainties.

As data centres continue to attract significant capital, success will depend on companies balancing ambitious growth with disciplined risk management and regulatory compliance. Those that master this balance will be best positioned to thrive in this sector, shaping the future of global connectivity and digital innovation.

Marsh’s Data Centre Insurance and Risk Management Services team is dedicated to providing comprehensive risk management and insurance advice and solutions for clients throughout the entire data centre lifecycle — from build, to operations, to ownership. For more information, please contact us to discuss how we can help support your data centre business's future development.

Our people

Sam Tiltman

Sam Tiltman

Digital Infrastructure Industry Leader, UK, and Technology Industry Growth Leader, UK

  • United Kingdom

Nicolae Muturniuc

Nicolae Muturniuc

Management Liability Client Executive

  • United Kingdom

Martin Bennett

Martin Bennett

Data Centre Lead, Private Equity and Mergers and Acquisitions Practice, Marsh UK

  • United Kingdom

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