This all-cash transaction, anticipated to finalize in the upcoming quarters, will secure Schneider a 75% ownership stake in the U.S.-based Motivair, with plans to acquire the remaining shares by 2028. The acquisition will bolster Schneider's capabilities in direct-to-chip liquid cooling and high-capacity thermal systems, as stated by the company.
The surge in the utilization of generative AI and large language models, such as Chat-GPT, necessitates more effective cooling solutions in data centers, particularly liquid cooling, since traditional air cooling methods are inadequate for managing the increased heat output, the company noted.
Motivair, located in Buffalo, New York, manufactures units that deliver coolant at extremely high pressures directly to the chips, thereby cooling servers more efficiently, according to Peter Herweck, Schneider's CEO.
The data center and networks segment represented 21% of Schneider's orders in 2023, translating to approximately 8 billion euros (around $8.7 billion) in sales, with double-digit growth projected for this year, Herweck indicated.
In the U.S. market, data center power consumption is forecasted to nearly triple from 2023 to 2030, necessitating an estimated 47 gigawatts of new generation capacity, according to Goldman Sachs.
While the U.S. remains the largest market, demand for data centers is also increasing in other regions.
Schneider's shares have risen by 31% this year, bolstered by its strong market position.
Herweck remarked that Schneider is not currently pursuing additional acquisitions for its data center portfolio.
“Motivair has effectively completed our portfolio for the time being,” he stated, while acknowledging that the company remains open to potential opportunities.
“We continue to be agile and maintain a robust balance sheet,” he added.
Earlier this year, Schneider Electric concluded discussions regarding a potential acquisition of U.S. engineering software firm Bentley Systems without reaching an agreement.