Goodman Group and US trust Digital Realty moved after hours to buy up to 9.9% of NextDC, pushing the embattled data centre operator’s shares about 44% higher to $9.43 by lunchtime and putting the company’s market value at about $7.15 billion.
The buying spree follows a sharp fall for NextDC in mid-October, when the company lost about 40% of its value after warning a planned upgrade to its West Footscray site in inner west Melbourne would be delayed into the 2028 financial year, a development that hit its earnings guidance.
NextDC, which operates 17 data centres around Australia, faced the new share purchases without advance notice. The transaction was carried out via brokers after the market closed, a method investors often use for strategic stakes but one that can signal an oppositional approach when targeted at a weakened bidder.
In a brokered statement, Goodman and Digital Realty said they were not preparing an immediate takeover bid.
“did not intend to mount a takeover bid ‘at this time’ but reserved the right to make a move in the future.”
NextDC’s board, led by managing director Craig Scroggie and chairman Douglas Flynn, described the share purchases as opportunistic and moved quickly to prepare for any further developments.
“Any bona fide approaches will be considered by the board on their merits and in the best interests of all NextDC shareholders,” the board said.
Local planning complications intensified NextDC’s vulnerability. Community opposition prompted Jemena to stop plans to install industrial-scale power poles to supply the West Footscray facility, and the Victorian government is not expected to rule on further expansions at the site until after the state election at the end of this month.
Data centre operators typically rely on timely capital and rapid construction so they can lease capacity and service debt. Delays can therefore be especially damaging to earnings and investor confidence, a weakness that has weighed on valuations across the sector.
AI-focused data centres have become politically charged in Australia and overseas. Markets have trimmed valuations for many companies exposed to heavy borrowing for data halls and chip infrastructure, and investor caution recently scuppered Firmus’s public float after the market balked at its intended $44 billion valuation.
NextDC has engaged advisers at Barrenjoey and UBS to handle any takeover approaches. A Goodman spokeswoman declined to comment. Goodman, best known for building large industrial warehouses, has been expanding into the data centre market since 2023 with mixed results, and its stake will keep NextDC under close scrutiny while planning and regulatory issues remain unresolved.
