Australian AI data centre company Firmus has cancelled a planned IPO shortly after closing its books for the offering, after reportedly attracting weak demand.

The company cited recent market volatility and said it would instead carry out a private fundraising round.

“Firmus will now pursue capital from the private markets and consider alternative public and private market options,” the company said.

Investor doubt

Founded in 2019 as a cryptocurrency-mining operation, Firmus, like other companies in the field, more recently switched to offering compute capacity for AI workloads to customers including Meta and OpenAI.

It operates two data centres and has a pipeline of projects across Asia amounting to a total of 921 megawatts of computing capacity, of which only 46MW has been built, according to investor documents cited by Bloomberg.

Initially the offering attracted strong attention, but demand later declined, with potential backers citing the high valuation Firmus was seeking, its lack of a proven track record, and a risk that existing shareholders could sell shares immediately after the IPO, according to a Bloomberg report citing discussions with investors and advisers.

Aggressive pricing

About 58 percent of shares would have been free to trade immediately after the flotation, the report said.

Other issues cited included increasing regulatory scrutiny and tighter financing conditions.

The company, backed by Nvidia among others, had sought to raise as much as $5.5 billion (£4bn) in what would have been one of Australia’s largest-ever IPOs, at an implied market value of A$43.7bn ($30bn, £23bn).

The company became a popular subject of tabloid headlines earlier this year when the prospect of an IPO emerged, due to the criminal record of co-founder Oliver Curtis, who was once jailed for insider trading, and Curtis’ partner being PR executive Roxy Jacenko, a prominent socialite.