Eaton beefs up data center segment with $9.5 billion Boyd Thermal deal

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By Aishwarya Jain and Kane Wu

(Reuters) -Eaton will acquire Boyd Corporation’s thermal business from Goldman Sachs Asset Management for $9.5 billion, the fourth deal this year for the power management firm seeking to bolster its data center segment to cater to AI demand surge.

The global appetite for energy-intensive data centers has sparked a wave of dealmaking across the industry, as companies race to build capacity to meet the surge in power and cooling needs.

Peer Vertiv also announced its plan to acquire PurgeRite Intermediate for about $1 billion to expand its liquid cooling services portfolio.

“What is impressive to us is that Eaton has gone “all-in” in liquid cooling with this chunky deal size, rather than dipping its toe in with a small investment like the other players have done,” said Deane Dray, analyst at RBC Capital Markets.

Boyd Thermal forecast sales of $1.7 billion for 2026, a majority of which is expected to come from its liquid cooling technology used at data centers, Eaton said on Monday, adding the deal value would represent 22.5 times Boyd Thermal’s estimated adjusted earnings before interest, taxes, depreciation and amortization for 2026.

“Our combined expertise in both power and liquid cooling from the chip to the grid will enable customers to manage increasing power demands more effectively,” said Eaton CEO Paulo Ruiz.

The company said in August it expects data center and distributed IT equipment to account for the largest share of its sales by the end of 2025, at about 17%.

Earlier this year, it bought Fibrebond, which designs and builds pre-integrated modular power enclosures used at data centers, for $1.4 billion.

In the last few months, it also acquired Resilient Power Systems, which makes transformers with applications in the EV sector and the data center industry, for an undisclosed amount, and aerospace systems firm Ultra PCS for $1.55 billion.

Eaton said the Boyd acquisition, expected to close in the second quarter of 2026, would boost its adjusted earnings starting in the second year after the deal is completed.

Goldman acquired California-based Boyd for $3 billion alongside China’s sovereign wealth fund China Investment Corp (CIC) in 2018, Reuters reported previously.

The investment was made via the China-U.S. Industrial Cooperation Fund that Goldman and CIC co-established in late 2017 on the sidelines of Donald Trump’s visit to Beijing during his first term as U.S. president.

After the sale, Boyd’s engineered materials business will continue to be backed by Goldman, the industrials company said in a statement late on Monday.

(Reporting by Aishwarya Jain in Bengaluru and Kane Wu in Hong Kong; Editing by Shinjini Ganguli and Kate Mayberry)