Data center power equipment manufacturer Forgent (FPS.US) made its debut on the New York Stock Exchange with the help of AI, raising $1.5 billion and reaching a valuation of $8.2 billion.

American Electric Power Company, Inc. equipment manufacturer Forgent Power Solutions Inc. (FPS.US) and some of its shareholders raised a total of $1.5 billion in their initial public offering, with the price set at the midpoint of the previously announced range. The data center power equipment design and manufacturing company released a statement on Wednesday indicating that its stock was priced at $27 per share. The company sold 16.6 million shares, while Neos Partners' affiliates sold 39.4 million shares, with an initial offering price range of $25 to $29 per share. According to sources, the IPO received double-digit oversubscriptions. Based on the number of outstanding shares listed in the prospectus, this pricing values the Minnesota-based company at approximately $8.2 billion. Forgent designs, manufactures, and sells equipment such as transformers, switchboards, and power distribution units for data centers, which require a consistent and reliable power supply. Neos, a private equity firm, founded the company in 2023 and expanded it through acquisitions in 2023 and 2024. The company's IPO comes at a time when investors are seeking to participate in the artificial intelligence spending boom, with OpenAI alone committing to invest over $1 trillion in AI infrastructure. Stocks in the power equipment sector have seen significant increases - nVent Electric surged 86% in the past 12 months, while Vertiv Holdings rose 64%. Forgent's CEO, Gary Nidaprum, previously worked at Vertiv. Morningstar electrical equipment industry analyst Nicholas Libb noted that Forgent's product line is not as broad as Vertiv's, as Vertiv is not only an electrical products provider but also a major supplier of cooling equipment for NVIDIA Corporation chips and other AI infrastructure, which brings them a valuation premium. Libb also stated that Forgent focuses on customized "on-demand design" electrical equipment for power transmission (the hardware that carries power from the grid to data centers) and benefits from additional growth drivers due to the need for grid upgrades, which is their strength. "These types of companies usually have strong profitability and a long operating history, with their long-term investment security mainly coming from their relatively slow product iteration speed," Libb analyzed. "However, the risk is that if the data center spending 'feast abruptly stops,' they will face significant challenges." Forgent has manufacturing facilities in Minnesota, Texas, Maryland, California, and Mexico. As of September 30, the company employed approximately 2,000 full-time employees. After the IPO is completed, Neos will continue to hold the majority of voting rights. According to financial documents, in the three months up to September 30, the company achieved revenues of $283 million and a net profit of $10 million; in the same period last year, revenue was $154 million and net profit was $6.3 million. This IPO is led jointly by Goldman Sachs Group, Inc., Jefferies Financial Group Inc., and Morgan Stanley. The company's stock is expected to begin trading on the New York Stock Exchange on Thursday under the ticker symbol "FPS".