- HVAC giant Trane has acquired liquid cooling specialist LiquidStack
- Trane’s interest in LiquidStack dates back to 2023, when it made a minority investment
- LiquidStack CEO Joe Capes will move over to Trane and continue to lead the business.
HVAC giant Trane has acquired liquid cooling specialist LiquidStack, signaling a strategic shift beyond air cooling as demand for AI-driven, high-density data center cooling accelerates.
Trane’s interest in LiquidStack dates back to 2023, when Trane made a minority investment in the up-and-coming liquid cooling player. The purchase price was not disclosed, but the deal includes LiquidStack’s employees as well as its manufacturing, engineering and R&D operations in Texas and Hong Kong. LiquidStack CEO Joe Capes will move over to Trane and continue to lead the business.
Liquid cooling market heats up
Trane's decision to outright acquire LiquidStack comes as consolidation starts to heat up in the rapidly growing data center cooling market.
In September 2025, Schneider Electric bought a controlling interest in direct-to-chip CDU vendor Motivair. Less than a year prior, data center infrastructure manufacturer Flex acquired cold plate and CDU supplier JetCool.
“It’s all about consolidation across the cooling technology spectrum. Trane is now positioned to offer true end-to-end thermal management – from chillers and heat rejection at the facility level, all the way down to direct-to-chip and immersion cooling at the rack level,” Dell’Oro Group Research Director Alex Cordovil wrote on LinkedIn.
It isn't about market share
"This wasn't about buying market share—it was about acquiring technology and expertise," Cordovil told Fierce. "Our estimates suggest LiquidStack generates a few dozen million dollars annually (in a liquid cooling market of around $2 billion). The strategic value lies in their CDU designs and immersion cooling IP, not revenue scale."
Trane previously partnered with LiquidStack and used their CDU designs. The acquisition makes integration much smoother, positioning Trane to scale LiquidStack's technology across Trane's global footprint, Cordovil said
LiquidStack is "definitely establishing themselves as a comprehensive end-to-end cooling provider spanning heat rejection, air-cooling solutions, and now liquid cooling," Cordovil said.
"This deal accelerates what we've been expecting—consolidation in a fragmented liquid cooling market, Cordovil said. "The sector has grown so rapidly that it attracted too many players chasing the same opportunity. We're now entering a phase where the market matures, winners emerge, and weaker players get absorbed. I definitely expect more acquisitions of small to medium-sized players, though I'll refrain from naming specific targets."
Submer buys Radian Arc
This week, immersion cooling company Submer scooped up Radian Arc, but that move was more focused on building a full-stack AI factory offering, which includes cooling expertise, design and construction capabilities, AI inference platforms and a telco-grade edge cloud offering.
Trane, Schneider and Flex, as well as other players like Accelsius, Asperitax, CoolIT, Iceotope and Vertiv are all chasing a direct liquid cooling market that Dell'Oro expects to grow to $7 billion by 2029.
Liquid cooling crossed key threshold
Though still just a portion of the broader data center physical infrastructure market, Cordovil recently noted the liquid cooling segment has crossed a key threshold.
“What was once treated as an optional efficiency upgrade is now a functional requirement for large-scale AI deployments,” Cordovil stated on Dell'Oro's site. “While the liquid cooling landscape is evolving rapidly—driven by innovation in cold plates, coolant distribution, and system architectures—single-phase direct liquid cooling has consolidated its position as the dominant architecture for AI clusters, supported by hyperscaler experience and accelerating vendor investment.”
This story was updated on Feb. 10, 2026, at 5:09 p.m. ET to include additional quotes received from Andrew Cordovil.