Flex Ltd. announced the acquisition of EPC Power Corporation, a New Hampshire-based provider of modular power conversion systems for AI data centers and grid applications. Deal terms were not disclosed. The transaction closes within 60 days pending regulatory clearance. EPC Power generated approximately $120M in trailing revenue with gross margins above 32%, according to a person familiar with the financials.
EPC Power specializes in medium-voltage power conversion equipment—the intermediary hardware that steps utility voltage down to the 480V three-phase power AI racks consume. The company's product line includes pre-engineered skid-mounted substations and liquid-cooled transformers designed for the 10MW to 50MW modular data halls now standard in hyperscale AI deployments. Flex's investor relations materials cite "strengthening position in high-growth infrastructure markets" without naming specific customers. EPC Power's disclosed client base includes two top-five cloud providers and three colocation operators, per its 2023 capability statement.
The acquisition solves a constraint Flex has faced since 2022, when it began manufacturing GPU server chassis for Microsoft and Oracle. Flex could build the compute hardware but lacked the power distribution expertise to bid on full turnkey data hall contracts—the integrated builds hyperscalers now prefer to shorten deployment timelines. EPC Power's modular substations reduce site commissioning time from 18 months to under 11 months, a metric that matters when training runs cost $50M per week in idle capital if delayed. The combined entity can now offer rack-to-grid solutions, competing directly with Vertiv and Schneider Electric's prefabricated data center units.
Timing aligns with the hyperscaler infrastructure wave. Microsoft has 85GW of data center capacity under contract through 2028. Meta is deploying 1.5GW of new AI training capacity in 2025 alone. Each gigawatt requires roughly $280M in power infrastructure—transformers, switchgear, cooling—before a single GPU draws current. EPC Power's backlog stood at $340M as of Q4 2024, with 68% attributed to AI data center projects, according to the source. Flex's existing relationships with Nvidia's server ecosystem partners position the combined company to capture design wins as GPU clusters scale from 10,000-node to 100,000-node configurations.
Allocators should monitor Flex's March earnings call for integration cost guidance and whether EPC Power's margin profile holds post-acquisition. Watch for follow-on partnerships with utility-scale battery operators—EPC Power's grid application revenue grew 140% year-over-year in 2024, suggesting potential in energy storage converter markets. Vertiv's stock moved 2.1% lower on the news before recovering, signaling the market views this as a credible competitive threat in modular power.
The deal confirms infrastructure hardware is no longer a commodity play. Power conversion is the new moat in AI deployment speed.
The takeaway
Flex gains modular power conversion capacity to bid on full-stack AI data center builds, targeting $3.5B market growing at 23% CAGR.
Editorial & Disclosure Notice: This article was written with artificial intelligence from public sources and is published without individual human review. Artificial intelligence and other digital tools are also used for research, analysis, editing, formatting, and production. Errors, omissions, outdated information, or inaccuracies may occur. References to companies, brands, products, services, organizations, or individuals are for informational and editorial purposes and do not imply endorsement, sponsorship, affiliation, partnership, or approval unless expressly stated. All trademarks and other intellectual property remain the property of their respective owners. Opinions, analysis, estimates, and commentary are informational only and should not be construed as financial, investment, legal, tax, medical, procurement, or other professional advice. Information may be corrected, clarified, or updated after publication. Corrections or removal requests: jenny@pops4.com.
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