Texas Bound: Hammond Power Solutions to Boost U.S. Footprint with New Fort Worth Facility Amid Rising Data Center Demand
Transformer manufacturer Hammond Power Solutions Inc. (HPS) is increasing its North American production capacity after recently signing a long-term lease agreement for a new manufacturing facility in Fort Worth, Texas.
The Canada-based company projects that the $36 million (C$50 million) Fort Worth facility will expand its capacity by roughly $177.3 million annually once fully operational in Q1 2028. As a provider of magnetic and power electronic solutions, HPS produces integrated hardware systems that manage electrical energy efficiently through advanced magnetism and semiconductor circuits.
An example of this solution-oriented development is HPS’s smart transformer units, which integrate advanced automatic computing meters directly onto low-voltage and medium-voltage transformers. With this emerging tech integration, facilities can transition operations from reactive to predictive maintenance while eliminating the safety risks associated with manual, on-ground inspections in the process.
These solutions provide critical support for power-intensive industries, including mining, steel, commercial construction, wind power generation and data center infrastructure development. According to a company release, the planned facility will expand HPS’s ability to serve these U.S.-based customers, who require large standard and custom-engineered transformers for massive GW-scale projects.
HPS noted that Fort Worth's strategic location closer to key North American customers will improve its ability to deliver certain products at shorter distances compared to its operational hubs in Canada and Mexico.
“This new investment in a U.S. facility is about being closer to our customers and better positioned to support the long-term demand we are seeing for our products,” said HPS CEO Adrian Thomas in a statement. “Demand for transformers continues to increase, particularly from large projects tied to data centers, electrification and power infrastructure.”
Thomas added that the Fort Worth facility, which is expected to begin production in stages starting in Q4 2027, will not only improve HPS's U.S. delivery speeds but also establish a vital additional domestic manufacturing footprint. As part of these initial phases, HPS expects to invest $35 million to $36 million to equip and commission the initial production phase through a combination of existing liquidity reserves and pre-approved corporate borrowing agreements (credit facilities funding).
In June, global law firm Norton Rose Fulbright facilitated a $450 million credit agreement between HPS and financial investors J.P. Morgan Chase, National Bank of Canada and Royal Bank of Canada. Under the agreement, HPS had access to up to $300 million in term debt to acquire energy storage converter provider AEG Power Solutions for approximately $258 million. The agreement also included a $150 million revolving credit facility, which will expire in Q3 2030.
HPS states the Fort Worth site could potentially support a total annual manufacturing capacity of $283 million to $284 million, as scalability and market demand increase for key electrical infrastructure equipment.
"Over the past several years, we have made significant investments to enhance efficiency, throughput and capacity across our manufacturing operations in Canada and Mexico,” said HPS chief operations officer John Bailey.
The Fort Worth facility, Bailey added, provides HPS an opportunity to apply the manufacturing processes learned from those investments in a new U.S.-built environment designed to bolster future growth.
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Eric Moody