I can’t believe it’s Friday already. Immediately upon returning from a Hawaii vacation I headed to Chicago for the fifth annual Packaging Automation Forum that Automation World hosts with Packaging World. Managing Editor Wes Iversen has a report of this highly successful event. We’re still not sure what direction the economy is going–especially regarding media–so the fact that the event was sold out (both attendees and sponsors) was gratifying.
I once made what I thought was a smart quip about a previous ABB acquisition, so I’ll keep this one straight. Automation insider pundits maintain that ABB needs to make an automation industry acquisition. Obviously it sees more growth in energy and the smart grid. It has agreed to acquire Ventyx for more than $1 billion from Vista Equity Partners to become a leading provider of software solutions for managing energy networks.
Meanwhile, Katie Fehrenbacher of the GigaOm Networks’ Earth2Tech blog, is reporting that Honeywell has bought demand response firm Akuacom, for an undisclosed price. This report is not substantiated on either company’s Web site.
When I was at last year’s ABB Power and Automation World conference, executives were strongly pointed toward energy and the “smarter grid” as the source of future growth. In fact, they were even holding tutorials on how to get on the US Federal government bid list. Taking automation technology and applying it to other areas is definitely beginning to be a trend.
Ventyx is a software provider to global energy, utility, communications, and other asset-intensive businesses, offering a broad range of solutions including: asset management, mobile workforce management, energy trading and risk management, energy operations and energy analytics. The company also provides software solutions for planning and forecasting electricity needs, including renewables.
ABB says it will combine its related network management business within the Power Systems division, with Ventyx to form a single unit for energy management software solutions. By providing ABB with broader access to the utility enterprise management market, the acquisition triples the energy management software market available to ABB.
“The big advantage for energy companies, utilities and industrial customers is that they will now have a single supplier of enterprise-wide information technology platforms and power automation systems,” said Joe Hogan, ABB’s CEO. “The advantage for our shareholders is a cash-generating acquisition in an exciting growth market, with a strong management team, a highly complementary offering and geographic scope, and an attractive return on capital employed.”
Based in Atlanta, Georgia, Ventyx has a large installed base in the US market and Europe and operates in more than 40 countries. Its customers include leading power utilities in the United States and Europe as well as industrial businesses. The company employs 900 people and reported 2009 revenues of about $250 million.
ABB notes the acquisition is in line with its strategy to pursue growth opportunities that complement the company’s product, technology and geographical portfolio. It is subject to customary regulatory approvals, and ABB expects the transaction to be completed in the second quarter. ABB intends to pay for the acquisition in cash.
“Combining Ventyx’s leading software suite with ABB’s systems and unparalleled domain knowledge of the power industry will create a business that is ideally placed to offer solutions that will help to meet the challenges of rapidly evolving energy networks,” said Vince Burkett, Ventyx CEO.
One of Ventyx’s key software applications gives utilities and grid operators the information they need to better match electricity generation with consumption, even at the household level. By generating real-time information on electricity demand, pricing and availability, Ventyx’s software enables a practical business model for utilities to generate revenues from smart grids and carbon trading.
Ventyx’s load forecasting software can also help to integrate large amounts of unpredictable renewable energies, such as wind and solar power. The company provides other asset management applications to fully integrate a utility’s business and enterprise systems across the entire value chain, and a comprehensive service suite to facilitate efficient resolution of network failures.