Ecolab revealed that it has finalized a deal to purchase CoolIT Systems, a rapidly growing, high-margin pioneer in liquid cooling solutions for next-generation AI data centers. CoolIT is projected to achieve around $550 million in revenue during the upcoming year.

CoolIT’s swift sales increase is anticipated to considerably bolster the company’s Global High-Tech growth engine and enhance Global Water’s organic sales growth rate by two percent, along with Ecolab’s overall organic sales growth rate by 1percent.

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The purchase, from funds overseen by KKR, establishes Ecolab as a complete cooling solutions supplier by enhancing its capabilities in the swiftly expanding data center sector.

CoolIT specializes in data center liquid cooling, offering comprehensive solutions that design and produce advanced liquid cooling systems, such as coolant distribution units (CDUs), cold plates, and direct-to-chip cooling technologies.

Having over 25 years of expertise, their technology assists the globe's biggest hyperscale and colocation providers in operating more effectively and dependably. As data centers transition from air cooling to liquid cooling to meet increasing computational needs, CoolIT’s essential technologies deliver the performance required for sophisticated AI tasks.

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Ecolab is enhancing its Cooling-as-a-Service offering by integrating CoolIT’s advanced thermal engineering technologies and design proficiency with its own knowledge in water, chemistry, fluid management, digital monitoring, and worldwide service. This cohesive solution aids AI data centers in enhancing performance, minimizing downtime, and decreasing water consumption throughout their operations.

As per the agreement, Ecolab will disburse roughly $4.75 billion in cash upon the transaction's closing, pending standard adjustments. This indicates 29x and 24x projected next 12-month and 2027 adjusted EBITDA for CoolIT.

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Christophe Beck, Ecolab chairman and chief executive officer says “AI is transforming the demands on data centers, and liquid cooling is one of the critical technologies that makes advanced computing possible”.

“By bringing together CoolIT’s engineered cooling technologies with Ecolab’s expertise in water, chemistry and digital service, we can provide our customers a complete cooling solution that improves performance and reliability while reducing water and energy use”.

“This acquisition expands our role in serving the AI ecosystem—semiconductor fabs that manufacture chips, power plants that fuel the chips, and data centers that utilize the chips—and positions Ecolab as the partner that the world’s largest technology companies rely on to grow responsibly and sustainably.”