Ventyx, which provides software to the utility industry, was rumored to be shopping around for a buyer. The purchase will triple the energy management software market available to ABB, which is a leader in power and automation technologies.
The software portfolio includes asset management, mobile workforce management, energy trading and risk management, energy operations, and energy analytics, as well as solutions for planning and forecasting electricity needs, including renewables.
ABB will combine Ventyx's assets with its own in the Power Systems division to be a single destination for energy management software solutions. One of Ventyx's key applications allows utilities to match up electricity generation with consumption down to the household level in real time, which will be essential for any carbon-trading scheme. It also provides load forecasting software that can be used to integrate renewable energy onto the grid and facilitate demand response.
"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," Joe Hogan, ABB's CEO, said in a statement. "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."
Ventyx, based in Atlanta, Georgia, has more than 900 customers in 40 countries. The company reported revenues of about $250 million in 2009. Ventyx is the culmination of several mergers and acquisitions in the past few years. In December 2006, Vista Equity Partners acquired Indus and merged it with its property MDSI; the company was rebranded as Ventyx in 2007. Later that year, Ventyx acquired Global Energy Decisions and NewEnergy Associates, followed by Tech-Assist, Inc. in early 2008.
ABB intends to pay cash for the acquisition, which is expected to be complete in the second quarter.