Multinational power utility Enel Green Power North America will launch a tender offer to purchase the US based energy company EnerNOC for $7.67 per share in an all-cash transaction, amounting to a total in the range $250-300m.
The transaction should reach closure by the third quarter of 2017.
Enel to expand its offering
By providing EnerNOC’s energy management technology and services to Enel’s existing commercial and industrial customers, the utility will be able to expand its demand response services. In addition to this, Enel will take on about 8,000 EnerNOC customers and 14,000 sites the business has under management, representing 6GW of demand response capacity.
EnerNOC, operating in the US, Europe and Asia, provides energy intelligence software that enables businesses to improve their energy efficiency and its energy procurement tools and services help customers to buy energy strategically, manage risk and optimise pricing.
The deal comes on the heels of Enel’s January acquisition of energy storage firm Demand Energy Networks and highlights the company’s growing interest in the provision of energy services alongside its core utility businesses.
Enel global e-Solutions head Francesco Venturini said: "Enel's acquisition of EnerNOC, six months after our acquisition of Demand Energy Networks, reflects our strategic focus on the energy technology and services space. EnerNOC’s technological expertise and positions in key markets will add further momentum to our efforts, while we leverage the existing global footprint of the Enel Group to open up new business opportunities.”
“The transaction unites us with one of the most innovative, global energy companies that shares our vision to change the way the world uses energy,” EnerNOC Chairman and CEO Tim Healy said in a statement. “In combining forces with the Enel Group, we look forward to accelerating the growth of our core businesses and to delivering ever more value to our customers.”
EnerNoc, which went public 10 years ago, revealed that it was facing financial challenges in March of this year. The company announced that it was considering strategic alternatives, such as selling some of its businesses to stay afloat.
EnerNOC came up against a number of challenges over the years such as legal threats, market changes and increasing competition in its US demand response business. In addition to this, its Energy Intelligence Software business has yet to gain momentum in the market.
Healy believes that the Enel acquisition is a “validation of our strategy in the marketplace” and says that it will provide an “unparalleled opportunity to connect customers with energy opportunities across the globe.”
Under the terms of the acquisition, EnerNOC expects to continue in its current lines of business, and to incorporate its software and services into Enel’s growing suite of customer-facing energy services.