Smart Energy Finances: Global equity funds acquire Energy Exemplar

In this week's Smart Energy Finances, Blackstone and Vista's acquisition of market simulation software provider Energy Exemplar and GE announced its official time frame for spinning off from energy business GE Vernova.

Also on the radar is the launch of AI software company Rhizome, a climate resilience planning platform for the power grid.

Blackstone and Vista acquire Energy Exemplar

Australia’s Energy Exemplar has been acquired by Blackstone- and Vista Equity Partners-affiliated private equity funds.

The company, known for its energy market simulation software, is calling the acquisition a move to scale up and improve its platform in support of grid reliability and the energy transition.

Energy Exemplar provides a platform for utilities, power producers, grid system operators, and others in the energy transition ecosystem to forecast market operations. According to the company, this can inform long-term investments and optimise ongoing operations of assets and systems.

According to Reuters reportage, the deal is valued at more than $1 billion, although the companies have not provided financial details.

The two buyout firms will each hold a 50% stake, with Energy Exemplar's existing owner Riverside Company cashing out.

“We are tremendously excited about this partnership and how it will accelerate our investment in our leading SaaS platform providing accurate simulation and decision support for our customers in today’s rapidly changing energy landscape,” said David Wilson, CEO of Energy Exemplar.

“The combination of Blackstone and Vista brings a unique level of expertise in both the energy and software industries…”

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Blackstone Energy Transition Partners is New York-based Blackstone's energy-focused private equity business, an energy investor with investments of over $21 billion in equity globally across a range of sectors within the energy industry.

Vista, on the other hand, is a global investment firm with more than $101 billion in assets under management as of 30 June 2023. The firm exclusively invests in enterprise software, data and technology-enabled organisations across private equity, permanent capital, credit and public equity strategies.

Said Ryan Atlas, managing director at Vista Equity Partners: "[Energy Exemplar’s] platform provides a holistic view of the impact traditional and emerging energy systems have on the businesses of those leading the energy transition.”

Added Bilal Khan, senior managing director at Blackstone Energy Transition Partners: “We’re thrilled to be backing Energy Exemplar, a mission-critical software provider supporting the growth of renewable energy, battery storage and transmission grid investment required for the energy transition.

“Blackstone’s energy market expertise and network of connections can enhance the company’s growth trajectory. We couldn’t be more excited to work with Vista, David, and the management team to drive the next stage of development for Energy Exemplar and its technology solutions supporting grid reliability and decarbonisation.”

Kirkland & Ellis LLP served as legal counsel, and William Blair served as financial advisor to Blackstone and Vista. Lazard acted as sole financial advisor, and Jones Day and Herbert Smith Freehills served as legal counsel to Energy Exemplar.

Clock ticking for GE Vernova’s spin-off

Boston-based conglomerate GE has set Q2 2024 as the date for its energy company’s spin-off, after which it will have its own ticker on the New York Stock Exchange.

The move was initially announced in a 2021 announcement of the company splitting into three public companies focused on energy, aviation and healthcare.

GE’s latest update now sets a time frame for the split, completion of which will see shares of GE Vernova listed on the New York Stock Exchange under the ticker symbol ‘GEV’.

GE Vernova CEO Scott Strazik said in a release: “Today’s milestone demonstrates the progress our team is making toward spinning off GE Vernova as an independent company driving both electrification and decarbonisation.

“We’re focused on delivering for our stakeholders while positioning our company for long-term success, and we are excited to launch GE Vernova on the New York Stock Exchange.”

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Commenting on the release of GE’s third quarter results was GE Chairman and CEO and GE Aerospace CEO H. Lawrence Culp, Jr.: “GE delivered another quarter of very strong results with double-digit growth in revenue, profit, and cash (…) At GE Vernova, our grid and now onshore wind businesses were both profitable this quarter and we expect their performance to continue to improve.

“With our two largest renewable energy businesses delivering and power's continued strength, we remain highly confident in GE Vernova's spin-off next year.”

Following the spin-off, in which GE will distribute common stock of GE Vernova to holders of GE common stock, General Electric Company will be known as GE Aerospace.

Added Culp, Jr.: “It’s been nearly two years since we announced our plan to create three independent, investment-grade, industry leaders. We’re now closing in on our final step—spinning off GE Vernova and launching GE Aerospace, following the successful spin-off of GE HealthCare earlier this year.

ICYMI: AI software company raises $2.5m for grid resiliency

Rhizome, a climate resilience planning platform for the power grid, announced its official launch, initial institutional capital raise of $2.5 million, and partnership with Seattle City Light and Vermont Electric Power Company (VELCO).

With ongoing engagements with several major electric utilities, Rhizome says it intends to make the electric grid more resilient by forecasting climate impacts on utility infrastructure and optimising grid investments.

Rhizome’s software platform was made to calculate the economic and social impacts of potential future power grid failures caused by climate change-fueled disasters such as storms, extreme temperatures, floods and wildfires.

Rhizome pairs resilience research from national labs with infrastructure data and proprietary machine learning to place a “value of resilience” on every proposed grid investment.

This is meant to inform utilities and regulators on the optimal investment plans that mitigate the most risk per dollar. Replacing and hardening aging assets, vegetation management, distribution automation devices, and distributed energy resources are all examples of interventions that Rhizome’s platform is able to assess.

Read the full story by Sean Wolfe

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Yusuf Latief
Content Producer
Smart Energy International

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