KKR to Sell CoolIT Systems to Ecolab in $4.75 Billion Deal, Delivering Major Returns and Employee Payouts
Global investment firm KKR has entered into a definitive agreement to sell CoolIT Systems, a leading provider of liquid cooling solutions for data centers, to Ecolab in a transaction valued at $4.75 billion. The deal represents a significant milestone for all parties involved, delivering substantial financial returns for investors and meaningful rewards for employees, while positioning CoolIT for its next phase of growth in the rapidly expanding artificial intelligence (AI) infrastructure market.
The transaction is expected to close in the third quarter of 2026, subject to customary regulatory approvals. Upon completion, CoolIT will continue to operate under its existing brand, with its leadership team, including CEO Jason Waxman, remaining in place to guide the company forward.
A Landmark Exit with Exceptional Returns
For KKR, the sale of CoolIT marks one of its most notable recent exits, generating approximately 15 times the original equity investment, including distributions. The investment was made in 2023 through KKR’s Global Impact Fund II, a strategy focused on scaling companies that address critical global challenges through commercially viable solutions.
CoolIT’s rapid growth trajectory and strong market positioning enabled KKR to realize significant value within a relatively short period. The company’s success reflects both favorable market dynamics—driven by surging demand for AI computing—and effective operational execution under KKR’s ownership.
Mubadala Investment Company, which participated as a co-investor, also played a key role in supporting CoolIT’s expansion and will share in the transaction’s financial outcomes.
Employee Ownership Delivers Tangible Benefits
A defining feature of this transaction is the broad-based employee ownership program implemented during KKR’s investment period. At the time of acquisition, CoolIT employees were granted equity stakes in the company, aligning their interests with long-term value creation.
As a result of the sale, all 650 employees will receive substantial cash payouts. These payouts vary based on tenure and role but are expected to range from approximately one year’s salary to more than eight years’ worth of annual pay for some employees. In addition to financial compensation, employees will be offered pre-paid financial coaching and tax preparation services to help them manage their gains effectively.
This approach reflects KKR’s broader strategy of promoting employee ownership as a means of driving performance and sharing economic success. Since 2011, KKR has facilitated equity participation programs across 85 portfolio companies, benefiting more than 190,000 employees worldwide. Notably, this transaction represents the firm’s first broad-based ownership payout in Canada and the first within its Global Impact strategy in North America.
Pete Stavros, Partner and Global Co-Head of Private Equity at KKR, emphasized the importance of this model, noting that employee ownership fosters a culture of accountability and innovation while ensuring that the benefits of growth are widely shared.
CoolIT’s Role in the AI Infrastructure Boom
Founded over 25 years ago, CoolIT has established itself as a pioneer in liquid cooling technology, a critical component of modern data center infrastructure. As demand for AI-driven computing continues to accelerate, traditional air-cooling systems are increasingly unable to meet the thermal management requirements of high-density workloads.
Cooling systems can account for up to 50% of total energy consumption in conventional data centers. In contrast, liquid cooling solutions—such as those developed by CoolIT—can reduce cooling energy usage by approximately 30% to 40%, while also minimizing water consumption through closed-loop designs.
These efficiency gains are particularly important as hyperscale data center operators seek to balance performance demands with sustainability goals. CoolIT’s technologies are already deployed in more than 300 data centers globally, supporting some of the world’s leading cloud providers and AI infrastructure operators.
In 2025 alone, CoolIT’s solutions delivered an estimated 2.18 billion kilowatt-hours of energy savings, equivalent to powering approximately 200,000 homes for an entire year. This impact underscores the company’s role in enabling more sustainable growth in the digital economy.
Operational Growth Under KKR Ownership
Since its acquisition in 2023, CoolIT has undergone a period of rapid expansion and operational transformation. Supported by KKR’s capital and strategic guidance, the company has scaled its capabilities to meet increasing market demand.
Key achievements during this period include:
- Workforce Expansion: CoolIT doubled its employee base, adding more than 300 new positions to support growth across engineering, manufacturing, and operations.
- Manufacturing Scale-Up: The company expanded its manufacturing footprint to over 300,000 square feet, significantly increasing production capacity.
- Technology Deployment: CoolIT enhanced its coolant distribution unit (CDU) capacity by 25 times, enabling it to support larger and more complex data center deployments.
- Financial Performance: The company is on track to achieve approximately fourfold revenue growth and tenfold EBITDA growth by 2026.
These developments reflect a combination of strong market demand, continuous product innovation, and deepening relationships with hyperscale customers.
Strategic Rationale for Ecolab
For Ecolab, the acquisition of CoolIT represents a strategic move to expand its capabilities in high-growth technology markets. Known for its expertise in water, hygiene, and energy technologies, Ecolab brings complementary strengths that can enhance CoolIT’s offerings.
By integrating CoolIT’s advanced liquid cooling systems with Ecolab’s capabilities in water management, chemistry, digital solutions, and global service delivery, the combined entity aims to deliver end-to-end cooling solutions for data centers.
Jason Waxman, CEO of CoolIT, highlighted the strategic fit between the two organizations, emphasizing that the combination will create a comprehensive platform capable of addressing the evolving needs of AI-driven infrastructure. He noted that the partnership positions the companies to become a leading force in liquid cooling, a technology increasingly recognized as essential for next-generation data centers.
KKR’s leadership views the investment in CoolIT as a textbook example of its Global Impact strategy in action—identifying scalable solutions to pressing challenges and driving value through operational improvements.
Kyle Matter, Managing Director and Head of North America Global Impact at KKR, pointed out that the firm anticipated the growing strain on data center infrastructure caused by rising computing demand. By investing early in a company with proven liquid cooling technology, KKR was able to capitalize on this trend while contributing to more efficient resource use.
Mubadala Investment Company also expressed confidence in CoolIT’s future, highlighting the value created through active management and aligned ownership. The firm believes that CoolIT is well-positioned to build on its momentum as part of Ecolab.
The transaction is being supported by leading financial and legal advisors. Morgan Stanley & Co. LLC and Baird are serving as financial advisors to KKR and CoolIT, while Kirkland & Ellis is acting as legal counsel.
As the deal progresses toward closing, regulatory approvals will be a key step in finalizing the transaction. Given the strategic importance of data center infrastructure and the scale of the deal, the review process is expected to be thorough but routine.
The $4.75 billion sale of CoolIT Systems to Ecolab marks a significant moment in the evolution of the data center cooling industry. It highlights the growing importance of liquid cooling technologies in supporting AI-driven workloads while addressing sustainability challenges.
For KKR, the transaction delivers exceptional financial returns and reinforces the effectiveness of its impact investing approach. For employees, it represents a rare opportunity to share directly in the success of the company they helped build. And for Ecolab, it provides a platform to expand into a critical segment of the digital infrastructure ecosystem.
As AI continues to reshape industries and drive unprecedented demand for computing power, companies like CoolIT will play an increasingly vital role in ensuring that this growth is both efficient and sustainable.
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