Z Squared announced that it has entered into a binding letter of intent to acquire a majority membership interest in Paradox Data, a digital infrastructure company focused on high-density, immersion-cooled compute for data-intensive workloads.
Z Squared is a digital infrastructure company expanding into AI infrastructure. The company said the proposed transaction would add energized power, developable land, and differentiated immersion cooling technology at a time when grid access, interconnection, and power availability are major constraints for AI and high-performance computing deployments.
Paradox Data’s flagship development asset is the Union County Campus in El Dorado, Arkansas. The site is being targeted as a next-generation data center campus designed to support high-density AI compute operations.
The proposed transaction is structured entirely in newly designated Series D Convertible Preferred Stock, with no cash consideration and no debt financing. Total consideration consists of Series D Convertible Preferred Stock with a $5 million aggregate initial liquidation preference, issued to sellers in proportion to their ownership of the interests sold.
Under the binding letter of intent, the assets and rights expected to be vested in Paradox at closing include its technology, data, and intellectual property, an approximately 10-acre land parcel under a binding purchase contract, and approximately 8 MW of fully operational energized power capacity.
The letter of intent also establishes a post-closing milestone structure under which Z Squared plans to pursue acceptance of an interconnection request for up to 50 MW of utility power.
The Union County Campus currently has an 8 MW live on-grid utility connection. Z Squared intends to develop a behind-the-meter generation campus designed to deliver up to 150 MW of continuous industrial-grade firm power.
The site spans up to 170 acres, is M-1 zoned and permitted, and is located in a pro-development jurisdiction. Z Squared said much of the infrastructure needed to execute the project is already in place.
Z Squared plans to use a hybrid strategy that combines the on-grid utility connection with natural gas generation through industrial turbines. The company said fuel delivery is supported by two pipelines with a combined capacity of 40,000 dekatherms per day through Energy Gas Transfer transmission infrastructure, enough to support more than 150 MW of on-site power generation.
The site also includes confirmed utility service from Entergy Arkansas and Energy Gas Transfer Utilities, direct Union Pacific rail access, and a completed fiber buildout delivering dedicated fiber of up to 400 Gbps. AT&T Fiber, Lumen, and Optimum are expected to provide redundant carrier-diverse connectivity.
The campus is also eligible for economic incentives, including Arkansas Enterprise Zone designations tied to job creation and capital investment.
Z Squared said the proposed acquisition supports its strategy of acquiring operating sites where power is already flowing, converting that capacity into AI-ready colocation, and scaling site by site based on signed contracts and operational readiness.
The transaction remains subject to definitive documentation, due diligence, required consents and approvals, and customary closing conditions, including any stockholder approval required under Nasdaq rules.
KEY QUOTES:
“Energized power and high-density immersion cooling are two of the scarcest and most valuable assets in AI infrastructure today, and this transaction would add both, anchored by a campus engineered for firm, large-scale power. Paradox represents exactly the kind of asset that advances our strategy. As we build this company site by site, Paradox is a prime representation of the opportunities we are seeking.”
David Halabu, Chief Executive Officer of Z Squared
