Vendor M&A’s Continue at Steady Pace

Steven Brown, editor in chief

Back in our July issue, we published an article titled “How Vendor Mergers are Shaping T&D.” That article gave details on 16 mergers that had occurred over roughly the previous 16 months between vendors of utility products, services and solutions. It also provided sound advice for any utility company that has found one of its technology suppliers has become the target of a merger or acquisition.

The rapid pace of M&A activity in the utility vendor sector has shown no sign of slowing down since publication of that article. In a period of just over two weeks prior to the writing of this column, three more fairly major acquisitions took place that could have an effect on readers of this magazine.

In late October, Group EFACEC, a Portuguese supplier of automation systems and infrastructure solutions to the energy and transport sectors, acquired Atlanta-based Advanced Control Systems Inc., a provider of utility automation solutions. ACS was founded in 1975 and has more than 250 customers. Going forward, ACS will operate as a wholly owned U.S. subsidiary of EFACEC. Prior to the ACS acquisition, Group EFACEC already counted several North American investor-owned utilities among its customers, including Florida Power and Light, Pacific Gas & Electric, Southern Company and Duke Energy. Major U.S. utility customers of both ACS and EFACEC include Nevada Power and NSTAR.

A little under two weeks later, on Nov. 7, ESCO Technologies signed a stock purchase agreement to acquire Doble Engineering. Massachusetts-based Doble has been providing diagnostic test solutions and instruments to electric utilities for more than 85 years. ESCO is the parent company of metering companies DCSI, Hexagram and Nexus Energy Software. Going forward, Doble will operate as a stand-alone subsidiary within ESCO’s Communications division, which also includes the aforementioned metering-related companies.

The very next day, Nov. 8, news crossed the wire that Trimble, a company best known for its global positioning system technology offerings, had acquired the UtilityCenter assets from Alabama-based UAI Inc. (formerly known as Utility Automation Integrators) in an all-cash transaction. UAI is a provider of geographic information system-based solutions, including workflow automation and outage management. Trimble says the purchase of UAI’s UtilityCenter platform will “extend Trimble’s portfolio of field and mobile worker solutions by providing application-specific software capabilities within the utilities market.”

In light of these most recent acquisitions, some of the advice proffered in that July article on vendor M&A’s probably deserves a re-read. Positives and negatives exist anytime Vendor A gobbles up Vendor B, but even the negatives can be mitigated through thoughtful planning and communication with the vendors involved.

If you’re a customer of any of the companies mentioned above, I would encourage you to find that July 2007 article in our Issue Archives (curiously placed under the “Current Issues” heading) at www.utility-automation.com. Even if none of the suppliers you currently do business with have been the target or the instigator of an acquisition, bookmark the article for later reference. Given the pace of M&A activity, it may only be a matter of time.

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