SLB acquires Kelvion for $3.4B in cash to become a data center cooling powerhouse

SLB, the energy technology company formerly known as Schlumberger, is spending $3.4 billion in cash to acquire German heat exchange specialist Kelvion. The deal, announced on August 31, values Kelvion at roughly $4.1 billion in total enterprise value when you factor in about $700 million in assumed debt.

That $4.1 billion price tag works out to approximately 11 times Kelvion’s estimated 2026 EBITDA before synergies.

The logic behind the deal

Kelvion is projected to generate between $2.3 billion and $2.4 billion in revenue in 2026, with roughly half of that, between $1.2 billion and $1.3 billion, coming from data center customers.

The combined entity expects pro forma data center revenue to exceed $2 billion by 2026, with ambitions to reach $4.5 billion to $5 billion by 2028. The corresponding EBITDA target for that data center business sits at $700 million to $800 million by 2028.

SLB also expects to squeeze out $120 million in annual EBITDA synergies within three years of closing. The deal is projected to boost SLB’s earnings and free cash flow per share within the first full year after it closes, which is expected in the first half of 2027, pending regulatory approvals.

SLB shares rose more than 1% in premarket trading after the announcement.

What the numbers tell us about SLB’s strategy

Going from roughly $2 billion in combined data center revenue in 2026 to $4.5 billion to $5 billion by 2028 implies something close to a doubling in two years.

The synergy target of $120 million annually is relatively modest compared to the deal size, representing less than 3% of the total enterprise value.

The decision to fund the acquisition entirely in cash, plus the assumed debt, means SLB is not diluting shareholders to make this happen.

Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.