Brookfield announces €20 billion AI infrastructure investment in France

PARIS - In a significant move to bolster France’s position in the artificial intelligence (AI) sector, Brookfield Asset Management (TSX:BAM) (market capitalization: $89.63 billion), along with French President Emmanuel Macron, has unveiled a €20 billion infrastructure investment program. The initiative, announced today at the Artificial Intelligence Action (WA:ACT) Summit in Paris, aims to support the deployment of AI infrastructure within the country. According to InvestingPro data, Brookfield’s stock has shown remarkable strength with a 46.72% return over the past year, though current analysis suggests the stock is trading above its Fair Value.

The investment will be concentrated in data centers and related infrastructure sectors crucial for AI development. Brookfield’s portfolio company, Data4, will lead the way with up to €15 billion dedicated to data center expansion. Data4, one of Europe’s top data center developers based in Paris, plans to increase its capacity to over 500 MW in various French regions, with aspirations to triple this capacity by 2030. With a strong current ratio of 1.52, InvestingPro analysis shows Brookfield maintains robust liquidity to support such major investments. For deeper insights into Brookfield’s financial health and investment potential, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.

This expansion positions France as Data4’s largest market in Europe. An additional €5 billion will be invested by Brookfield in France to enhance associated AI infrastructure, including data transfer, chip storage, and energy generation. The comprehensive investment is projected to be completed by 2030.

President Macron highlighted the investment’s significance, stating it would keep France competitive among leading AI nations. He emphasized the country’s attributes, such as expertise, talent, and decarbonized energy, which are essential for AI advancement.

Sikander Rashid, Head of Europe at Brookfield, expressed confidence in France’s potential to become a pivotal player in global AI development. The investment is seen as a crucial step toward achieving European leadership in AI, providing the necessary infrastructure for France to compete internationally.

Brookfield, a major investor in the AI value chain, has a history of significant investments, including a landmark renewable power supply deal with Microsoft (NASDAQ:MSFT) and a $30 billion partnership with Intel (NASDAQ:INTC) for a semiconductor foundry in Arizona. The company has been active in France since 2015, employing over 7,000 people and investing in various sectors, including digital and renewable energy infrastructure.

The information for this article is based on a press release statement by Brookfield Asset Management, which details the investment program and its potential impact on France’s AI infrastructure development. Trading at a P/E ratio of 51.98, Brookfield commands a premium valuation reflecting its market leadership. InvestingPro subscribers have access to over 30 additional financial metrics and 12 exclusive ProTips that provide deeper insights into Brookfield’s investment potential and market position.

In other recent news, Brookfield Corporation’s earnings report revealed a significant increase in distributable earnings, with a record high of $1.3 billion achieved. This marks a 19% rise compared to the previous year. The company also reported over $17 billion in asset monetizations and has committed approximately $20 billion to new investments.

BMO Capital Markets revised its price target for Brookfield, lifting it to $62 from the previous $50, maintaining an Outperform rating on the stock. This adjustment reflects the firm’s optimism about Brookfield’s prospects for the year 2025, backed by beneficial conditions for asset monetizations, carry realizations, and benefits derived from lower yields.

The analyst from BMO Capital expressed confidence in Brookfield’s future, citing the improved valuation of the company’s privately held real estate portfolio as a key factor. The firm’s analysis suggests that Brookfield Corporation is trading at a valuation discount, implying a potentially attractive risk-reward scenario for investors.

These recent developments indicate Brookfield’s strong financial health and strategic positioning for future growth. The company’s Wealth Solutions business, real estate portfolio, and renewable energy segment all contributed to its solid performance. Despite concerns raised about market perceptions, Brookfield’s management remains confident in their strategy and the company’s value proposition.

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