Blackstone and Vista Equity Partners said they will acquire Australia’s Energy Exemplar, a provider of energy market software, from private equity firm Riverside Company in a deal that sources noted was worth more than $1 billion.
The companies did not provide any financial details.
Reuters reported the move earlier in the day before the companies had unveiled the deal.
The two buyout firms will each hold a 50% stake, with Energy Exemplar’s existing owner Riverside Company cashing out, said the sources, who declined to be named.
The deal represents a bet on energy transition, as power utilities, grid operators and renewable energy developers turn to simulation software to fine tune use of production capacity and maximize efficiencies.
Energy Exemplar has grown at an annual compound rate of 30% since 2018 under Riverside’s ownership, the sources said. The North Adelaide-based company provides software tools that are used by more than 500 companies in 79 countries to simulate and forecast the electric, water, gas and renewable energy markets.
Blackstone is investing in Energy Exemplar through its energy transition arm, which is in the process of raising a new fund. Dubbed Blackstone Energy Transition Partners IV, the fund had raised $2.2 billion towards its $5.6 billion target as of the end of August, according to a filing with the U.S. Securities and Exchange Commission.
Bilal Khan, senior managing director at Blackstone Energy Transition Partners, said the company is excited to work with Vista and Energy Exemplar to “drive the next stage of development for Energy Exemplar and its technology solutions supporting grid reliability and decarbonization.”
“This investment is the latest in a series demonstrating Blackstone’s conviction in the energy transition.”
The New York-based buyout firm has been moving aggressively into this area, declaring last year that it saw an opportunity to deploy $100 billion in energy transition and climate change solutions projects over the next decade.
Its previous investments include Transmission Developers, solar mounting firm Esdec, environmental engineering firm Geosyntec, environmental commodity exchange Xpansiv, and renewable energy firm Invenergy.
Blackstone also said in August it had raised the largest credit fund in the world dedicated to energy transition, amassing $7.1 billion.
Vista, a software sector specialist, is participating in the deal through its middle-market Foundation strategy. The firm raised its fourth Foundation fund in 2020, amassing $4.5 billion, and is expected to raise a new one in the coming months.
Ryan Atlas, managing director at Vista Equity Partners, said the firm, along with Blackstone and Energy Exemplar, is looking forward to “leveraging our experience in scaling transformative enterprise software companies to further accelerate innovation and customer value.”
