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Firmus, CDC end planned $51B Australian AI buildout
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CDC exits $51 billion AI data center project in Australia after its partner, Firmus, embarks on aggressive Asian expansion.
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CapitalAsia-Pacific
CDC exits $51 billion AI data center project in Australia after its partner, Firmus, embarks on aggressive Asian expansion.
CDC exits $51 billion AI data center project in Australia after its partner, Firmus, embarks on aggressive Asian expansion.
Nvidia-backed Australian data center alliance Project Southgate has broken up after just 12 months with a fraction of its planned 1.6GW buildout completed. CDC Data Centers has ended its partnership with Firmus – claimed to be worth as much as 73 billion Australian dollars (US$50.7 billion) – due to fears over Firmus' aggressive Asian expansion plans.
CDC CEO Greg Boorer told financial news site Rampart: "We're certainly not planning on doing 1.6GW of rollout with them because they made other choices regarding doing their own data center developments, which is slightly different to what we envisaged."
The partnership built just 42MW of data center capacity, all of it in a CDC facility in Melbourne.
Project Southgate was unveiled in October 2025 by Firmus, CDC and Nvidia as a planned rollout of Firmus' "AI factories" built on CDC data center infrastructure. It was intended to scale to 1.6GW by 2028, with Firmus claiming total investment could reach AU$73 billion ($50.7 billion).
Firmus Co-Chief Executive and Cofounder Oliver Curtis said the two partners had "mutually agreed earlier this year" to end their partnership, W.Media reported Tuesday.
He said the decision did not affect Firmus' current development plans. But it seems a string of major deals Firmus embarked on in the last four months, none of which has involved CDC, has administered the death blow to the CDC alliance.
These include a 360MW Nvidia-backed data center on Batam Island, Indonesia, as well as two sites in Malaysia for OpenAI, and another two sites in South Australia. Additionally, Firmus is partnering with Subco to build a new subsea cable from the Australian mainland to Tasmania.
The collapse of the giant project comes as Firmus, in a rare step, looks set to cut the price of its pending IPO because of risks over its mostly unbuilt data center capacity. Jun Bei Liu, portfolio manager at Ten Cap, criticized the company for an "unprecedented" lack of disclosure, ABC News reported.
Firmus had originally set the price at AU$A11 ($7.65), valuing the company at around AU$44 billion ($30.6 billion). But the IPO price is reportedly set to drop to AU$9 ($6.26) because of weak demand from investors.
Meanwhile, CDC’s valuation has declined, primarily due to higher interest costs following a series of rate rises in Australia this year. CDC is 49.7% owned by listed New Zealand and Australian infrastructure investor Infratil, which also owns New Zealand mobile operator OneNZ. Infratil says the latest independent valuation of its CDC stake declined by A$45 million ($31.3 million) in the third quarter from AU$9.21 billion ($6.4 billion) to A$9.17 billion ($6.37 billion).
Infratil's ASX stock declined 0.72% Wednesday.
About the Author
Robert Clark is an independent technology editor and researcher based in Hong Kong.
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