Market AnalysisJul 15, 20262 Min
Data center operator Switch getting ready for ‘boomerang’ IPO
The Las Vegas-based data center operator Switch is preparing for an initial public offering (IPO) that could value the company at up to $80 billion, according to a new report.
The report said that the IPO could raise as much as $10 billion and could hit the market as soon as the fourth quarter of the year.
Switch has already tapped banks Goldman Sachs and JPMorgan Chase as lead underwriters for the IPO process, according to the report.
Interestingly, the move marks the return of the company to the public markets through a ‘boomerang’ IPO.
What is a boomerang IPO?
A boomerang IPO is when a company taps the public markets, is later acquired by a private entity and gets delisted, and then returns to the public markets.
Notably, Switch has been through that journey.
It is not the first time that the company is preparing for an IPO. In fact, the stock had traded on the US stock exchanges for five long years.
Switch was valued at roughly $4.2 billion when it had first gone public back in October 2017. The company had raised $531 million that time. It was one of the largest US technology listings of 2017, with major underwriters including Goldman Sachs, JP Morgan, BMO Capital Markets and Wells Fargo.
The stock had begun trading on the NYSE under the ticker symbol “SWCH” on October 6, 2017.
Five years later, in December 2022, DigitalBridge Group Inc. and IFM Investors acquired all outstanding common shares of Switch for approximately $11 billion, including the repayment of outstanding debt. The deal delisted Switch from the NYSE.
But the IPO preparations have begun again in 2026, probably to cash in on investors' appetite for companies benefiting from surging demand for artificial intelligence (AI) infrastructure.
New IPO plans
Though the size, timing and valuation of the Switch 2026 IPO are still under discussion and may change, the potential $10-billion size could rank among the largest US stock market debuts in recent years.
Moreover, an $80 billion valuation also marks an increase of 20 times compared with the $4.2 billion valuation the company saw in 2017.
This justifies the move to launch a boomerang IPO. Going public comes with the pressure of constant oversight and the need to meet quarterly performance goals while executing tough growth plans.
Being private in such situations gives companies time to restructure, develop new products or improve efficiency without being under constant market glare.
Once the company stabilizes and market conditions become favourable again, the idea to take the company public again to generate a large return on investment becomes attractive.
Since the US IPO market has flourished this year, especially after the largest-ever IPO of Elon Musk-led SpaceX, a large number of AI companies like Anthropic and OpenAI have started advanced preparations for their public offers.
What does Switch do?
Switch operates large-scale data center campuses serving over 550 customers including Nvidia, Dell Technologies and FedEx. These campuses provide the power, cooling and connectivity needed to support AI computing.
Switch’s data centers have been powered by renewable energy since 2016, which appeals to technology companies with decarbonization targets.
The company has recently been on a capital-raising spree. Last month, it raised its available debt facility to $9.5 billion.
The company said the credit facilities will enhance Switch’s ability to secure the transmission and generation resources required to deliver critical AI and cloud infrastructure at scale.
