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SLB's Kelvion Deal Expands Its Data Center Growth Platform
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Key Takeaways
SLB agreed to buy Kelvion for $3.4B in cash, adding thermal management to its Data Center Solutions business.
Kelvion is expected to generate $2.3-$2.4B in revenues by 2026, with data centers contributing $1.2-$1.3B.
SLB targets $4.5-$5B in combined revenues and $700-$800M in adjusted EBITDA by 2028.
SLB N.V. (SLB - Free Report) has signed an agreement to acquire Kelvion, a global provider of thermal management and heat-exchange technologies, to accelerate the expansion of its Data Center Solutions business.
The acquisition broadens SLB’s exposure to AI-driven infrastructure spending while adding technologies that complement its existing modular manufacturing, engineering, digital and system-integration capabilities.
Kelvion Adds Scale to SLB’s Data Center Business
Kelvion is expected to generate approximately $2.3-$2.4 billion in revenues and $350-$400 million in adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) in 2026. Data centers represent its largest and fastest-growing end market, with revenues projected at $1.2-$1.3 billion.
The acquisition broadens SLB’s addressable market, with management expecting its revenue opportunity per gigawatt of delivered data center capacity to more than double. Kelvion’s thermal management capabilities add a critical component to SLB’s existing data center infrastructure offering as facilities become increasingly energy-intensive.
How the Kelvion Deal Benefits SLB
The transaction strengthens SLB’s ability to provide more integrated data center infrastructure solutions by incorporating cooling and heat-transfer technologies directly into its modular offering.
This combination expands the company’s revenue opportunity, strengthens its position across the data center value chain and provides access to Kelvion’s established energy and industrial markets. Management expects cost efficiencies and incremental revenue opportunities to enhance transaction economics.
Data Center Growth Supports the Investment Case
SLB’s Data Center Solutions business is expanding rapidly, with revenues expected to register a compound annual growth rate exceeding 90% between 2024 and 2026. Cumulative delivered capacity is projected to surpass 2 gigawatts by year-end.
On a pro forma basis, SLB and Kelvion together are expected to generate more than $2 billion in data center revenues and approximately $300 million in adjusted EBITDA in 2026. SLB is targeting revenues in the range of $4.5-$5 billion and adjusted EBITDA to be between $700 million and $800 million for the combined business by 2028, highlighting the earnings potential of this strategic expansion.
Financial Benefits Support the Investment Case
SLB will acquire Kelvion for approximately $3.4 billion in cash and assume about $0.7 billion of debt. The transaction is valued at roughly 11 times estimated 2026 EBITDA before synergies and about 8.5 times EBITDA after expected synergies.
Management expects the acquisition to be accretive to earnings per share and free cash flow per share during the first 12 months after closing. SLB also targets approximately $120 million in annual EBITDA synergies within three years.
What Should SLB Investors Watch?
The transaction is expected to close in the first half of 2027, subject to regulatory approvals and customary conditions. Execution of the targeted synergies and 2028 growth objectives will therefore be important.
Following completion, SLB expects net debt-to-EBITDA to remain within its through-cycle ceiling of 1.5 times. The company reaffirmed plans to return more than $4 billion to shareholders in 2026, preserving a balance between strategic investment and shareholder distributions.
SLB’s Zacks Rank & Key Picks
SLB currently carries a Zacks Rank #3 (Hold).
While SLB is gaining direct exposure to the data center buildout through Kelvion, other energy equipment and service companies such as Drilling Tools International Corporation (DTI - Free Report) , RPC, Inc. (RES - Free Report) and Oceaneering International, Inc. (OII - Free Report) are positioned to benefit indirectly from the rising power requirements associated with expanding data center capacity. Higher electricity demand is likely to enhance investment in natural gas production and broader energy infrastructure, supporting activity across drilling, completion and offshore markets.
Drilling Tools manufactures and rents downhole tools used in oil and natural gas wells, positioning it to participate if greater power requirements translate into additional natural gas drilling activity. Despite softer North American land activity and Middle East disruptions, DTI generated $4.1 million of adjusted free cash flow in the second quarter of 2026, up substantially both sequentially and year over year, while management noted improving activity trends in several markets.
RPC provides completion, production and maintenance services, including pressure pumping, downhole tools, wireline and cementing, giving it exposure to upstream activity that may expand as electricity demand increases the need for dependable energy supplies. RES’s second-quarter revenues increased 1% sequentially to $460.9 million, while adjusted EBITDA rose 23.3% to $66 million, supported by improved job mix and higher activity across several service lines.
Oceaneering International provides engineered services, products and robotic solutions to the offshore energy market. In the second quarter of 2026, revenues increased 10% to $768 million and adjusted EBITDA rose 11% to $115 million. OII’s Manufactured Products backlog stood at $445 million as of June 30, 2026, with additional orders expected during the second half.
View the Zacks #1 Rank List
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SLB's Kelvion Deal Expands Its Data Center Growth Platform
Key Takeaways
SLB N.V. (SLB - Free Report) has signed an agreement to acquire Kelvion, a global provider of thermal management and heat-exchange technologies, to accelerate the expansion of its Data Center Solutions business.
The acquisition broadens SLB’s exposure to AI-driven infrastructure spending while adding technologies that complement its existing modular manufacturing, engineering, digital and system-integration capabilities.
Kelvion Adds Scale to SLB’s Data Center Business
Kelvion is expected to generate approximately $2.3-$2.4 billion in revenues and $350-$400 million in adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) in 2026. Data centers represent its largest and fastest-growing end market, with revenues projected at $1.2-$1.3 billion.
The acquisition broadens SLB’s addressable market, with management expecting its revenue opportunity per gigawatt of delivered data center capacity to more than double. Kelvion’s thermal management capabilities add a critical component to SLB’s existing data center infrastructure offering as facilities become increasingly energy-intensive.
How the Kelvion Deal Benefits SLB
The transaction strengthens SLB’s ability to provide more integrated data center infrastructure solutions by incorporating cooling and heat-transfer technologies directly into its modular offering.
This combination expands the company’s revenue opportunity, strengthens its position across the data center value chain and provides access to Kelvion’s established energy and industrial markets. Management expects cost efficiencies and incremental revenue opportunities to enhance transaction economics.
Data Center Growth Supports the Investment Case
SLB’s Data Center Solutions business is expanding rapidly, with revenues expected to register a compound annual growth rate exceeding 90% between 2024 and 2026. Cumulative delivered capacity is projected to surpass 2 gigawatts by year-end.
On a pro forma basis, SLB and Kelvion together are expected to generate more than $2 billion in data center revenues and approximately $300 million in adjusted EBITDA in 2026. SLB is targeting revenues in the range of $4.5-$5 billion and adjusted EBITDA to be between $700 million and $800 million for the combined business by 2028, highlighting the earnings potential of this strategic expansion.
Financial Benefits Support the Investment Case
SLB will acquire Kelvion for approximately $3.4 billion in cash and assume about $0.7 billion of debt. The transaction is valued at roughly 11 times estimated 2026 EBITDA before synergies and about 8.5 times EBITDA after expected synergies.
Management expects the acquisition to be accretive to earnings per share and free cash flow per share during the first 12 months after closing. SLB also targets approximately $120 million in annual EBITDA synergies within three years.
What Should SLB Investors Watch?
The transaction is expected to close in the first half of 2027, subject to regulatory approvals and customary conditions. Execution of the targeted synergies and 2028 growth objectives will therefore be important.
Following completion, SLB expects net debt-to-EBITDA to remain within its through-cycle ceiling of 1.5 times. The company reaffirmed plans to return more than $4 billion to shareholders in 2026, preserving a balance between strategic investment and shareholder distributions.
SLB’s Zacks Rank & Key Picks
SLB currently carries a Zacks Rank #3 (Hold).
While SLB is gaining direct exposure to the data center buildout through Kelvion, other energy equipment and service companies such as Drilling Tools International Corporation (DTI - Free Report) , RPC, Inc. (RES - Free Report) and Oceaneering International, Inc. (OII - Free Report) are positioned to benefit indirectly from the rising power requirements associated with expanding data center capacity. Higher electricity demand is likely to enhance investment in natural gas production and broader energy infrastructure, supporting activity across drilling, completion and offshore markets.
DTI currently sports a Zacks Rank #1 (Strong Buy), while RES and OII carry a Zacks Rank #2 (Buy), each. You can see the complete list of today’s Zacks Rank #1 stocks here.
Drilling Tools manufactures and rents downhole tools used in oil and natural gas wells, positioning it to participate if greater power requirements translate into additional natural gas drilling activity. Despite softer North American land activity and Middle East disruptions, DTI generated $4.1 million of adjusted free cash flow in the second quarter of 2026, up substantially both sequentially and year over year, while management noted improving activity trends in several markets.
RPC provides completion, production and maintenance services, including pressure pumping, downhole tools, wireline and cementing, giving it exposure to upstream activity that may expand as electricity demand increases the need for dependable energy supplies. RES’s second-quarter revenues increased 1% sequentially to $460.9 million, while adjusted EBITDA rose 23.3% to $66 million, supported by improved job mix and higher activity across several service lines.
Oceaneering International provides engineered services, products and robotic solutions to the offshore energy market. In the second quarter of 2026, revenues increased 10% to $768 million and adjusted EBITDA rose 11% to $115 million. OII’s Manufactured Products backlog stood at $445 million as of June 30, 2026, with additional orders expected during the second half.