MW AI growth fuels Eaton acquisition as industrial companies tap into big U.S. data-center buildup

By Steve Gelsi

Eaton's $9.5 billion Boyd Thermal deal follows its purchase of Fibrebond and Resilient Power for more than $1.5 billion, as companies outside the tech sector get involved in AI

Eaton sees an opportunity to take part in a surge of investment in data-center construction.

An earlier version of this article contained an incorrect spelling for Fibrebond Corp. in its sub-headline.

Eaton Corp. is making its third and largest acquisition this year to boost its product offerings in the data-center infrastructure space, which has seen a construction backlog reach nearly half a trillion dollars over the past 12 months.

Eaton $(ETN)$ said Monday its $9.5 billion purchase of the Boyd Thermal unit of Boyd Corp. from seller Goldman Sachs Group Inc.'s $(GS)$ private-equity arm will add a liquid-cooling business to its array of electrical products including backup power, power-distribution units, conduit boxes, fittings and fiber networks.

An Eaton spokesperson declined to comment further on the deal, after MarketWatch reached out to the power-management company about the expected impact of the acquisition on its data-center business.

Eaton has already announced two data-center deals in recent months: the $150 million purchase of Resilient Power on July 16 and the $1.4 billion acquisition of Fibrebond Corp., a designer and builder of modular power enclosures for data centers, in March.

Asked about Eaton's focus on data centers at a Sept. 12 investor conference, CEO Paulo Ruiz said the company sees an opportunity as spending on data-center projects - those currently in construction or those that have been announced - has soared in the past year, to an estimated $470 billion from $150 billion a year ago.

"It's over three times the backlog that the industry had in hand last year - so it's a tremendous tailwind for our business and we are really excited about it," Ruiz said.

In the second quarter, Eaton's data-center business grew 50% and its orders were up 55%, he said.

"So that market is really hot," Ruiz said.

Eaton's stock rose 0.2% in morning trading Monday. It has gained 15.4% in 2025, while the S&P 500 index SPX has advanced 16.6%.

Along with data centers, Eaton said it sees opportunities to support utility companies as well as commercial and defense-related aerospace.

While data centers have been seen as a boost to tech companies in the artificial-intelligence business, the power demand for AI has driven interest in many industrial sectors, including utility companies such as Constellation Energy Corp. (CEG), and even bulldozer maker Caterpillar Inc. $(CAT)$.

Also read: Caterpillar's stock hits a record high on bright outlook for energy and AI data-center development

Wall Street's interest in the arena remains strong, as shown by the success of an initial public offering from Fermi Inc. (FRMI). The power-development company managed to raise $683 million in its IPO even though it has yet to generate any significant revenue.

Boyd Thermal is expected to generate $1.7 billion in sales in 2026. Goldman Sachs Asset Management, which has owned Boyd Thermal since 2018, will retain ownership of Boyd's engineered-materials business as an independent company.

Separately, Eaton is due to report third-quarter results on Tuesday. Based on current analyst estimates compiled by FactSet, the company is expected to report an eighth straight quarter of year-over-year sales declines.

Eaton makes power-management products such as uninterruptible power systems, as well as aerospace products such as aerial-refueling gear.

-Steve Gelsi

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November 03, 2025 11:24 ET (16:24 GMT)

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