- >>> Center City energy startup sells for $35M
Jan 3, 2017
Philadelphia Business Journal http://www.bizjournals.com/philadelphia/news/2017/01/03/nevada-ormat-buys-virdity-energy-35-million.html?ana=yahoo
A Philadelphia-based energy tech startup is being acquired by a Nevada-based geothermal and renewable energy company for an initial consideration of $35 million, the companies announced Tuesday.
Publicly held Ormat (NYSE: ORA) signed an agreement to buy Viridity Energy, a private company based at Ten Penn Center in Center City, with the aim of bringing on Viridity's proprietary SaaS platform that manages energy demand, demand response and battery storage.
Shareholders will receive $35 million at closing, and the companies said if performance milestones for the end of the 2017 and 2020 fiscal years are met, additional contingent considerations will be paid out in two installments. The latter part of the agreement may ease concerns of investors, reports GreenTech Media, as the $35 million price tag comes in below the $40 million Viridity raised over four funding rounds in 2009, 2011, 2012 and 2016.
"Leveraging Ormat’s breadth of capabilities, electricity market expertise and resources, we will have a unique opportunity to accelerate innovation and deliver significant value to our customers and partners. Viridity will be ideally positioned to fulfill our core mission, and our employees will benefit from becoming part of a larger company," Viridity CEO Mack Treece said in a statement.
Viridity's staff, management and client relationships will stay in place once the deal closes early this year.
The 8-year-old company works with major energy providers, utilities and users to bring them the increased efficiency, energy revenue and savings using algorithms and automated, real-time sales in the wholesale electric power market.
By purchasing Viridity, Ormat aims to get into a growing trend in energy storage that centers on using automated technologies to optimize how energy is sold, managed and stored. A new report from Navigant Research, cited by industry media outlet Energy Storage News last month, poses energy storage software as a fast-growing segment of the energy sector that could go from drawing $201.2 million million in 2016 to $3.4 billion by 2025.
“This acquisition marks Ormat’s entry into the rapidly growing energy storage and demand response markets, with an established solutions provider that has an experienced leadership team and employees with in-depth knowledge and significant expertise," Ormat CEO Isaac Angel said. "Ormat intends to use the Viridity platform to accelerate growth, expand its market presence, and further develop Viridity’s demand response VPower™ software platform and energy storage services."