Stem, Inc., a global leader in artificial intelligence (AI)-driven energy storage software and services, and Also Energy Holdings, Inc., a global leader in solar asset management software, have announced that the companies have entered into a definitive agreement whereby Stem will acquire AlsoEnergy, in a stock and cash transaction.
Under the terms of the agreement, Stem will acquire, on a cash-free debt-free basis, all the outstanding shares of AlsoEnergy for an aggregate purchase price of $695 million, consisting of approximately 75 percent of the total consideration in cash and approximately 25 percent in Stem common stock.
The transaction will combine Stem’s unique storage optimization capabilities with AlsoEnergy’s market-leading solar asset performance monitoring and control software to deliver a compelling one-stop-shop solution for renewable energy projects. In addition, Stem will offer its smart energy storage solutions to AlsoEnergy’s existing front-of-meter and commercial & industrial customers, who generally have limited storage attachment to their solar assets today. AlsoEnergy will gain earlier visibility into solar plus storage projects through Stem’s extensive customer and partner network.
John Carrington, Chief Executive Officer of Stem, remarked, “Through this immediately accretive transaction, a combined Stem and AlsoEnergy will bring the unique software, controls, and analytics capability to accelerate the energy transition to a renewable, decarbonized future. As the battery storage and solar industries continue to experience tremendous global growth, developers, asset owners, and utilities will increasingly look to our combined software capabilities to provide a unified platform for energy intelligence that improves project performance. The combined company will deliver an AI-driven software offering that we expect will simplify our customers’ asset management, boost their project returns, and accelerate our own growth trajectory. Importantly, this acquisition is expected to be immediately accretive to both gross margin and EBITDA before realizing any commercial synergies, which we believe are significant and compelling. This acquisition underscores our focus on expanding Stem’s global reach and delivering high margin, market-leading software products to our customers.”
Robert Schaefer, Chief Executive Officer of AlsoEnergy, said, “Combining our business with Stem will unlock tremendous value for customers as they increasingly focus on integrating solar and energy storage assets to optimize financial performance. The software, access to data, and technical capabilities of our combined companies will bring the next level of control and optimization to AlsoEnergy’s leading monitoring offerings, enabling a single vendor for software services across the solar and storage landscape. We are thrilled to be joining the Stem team, and together, believe our combined software offering will become a critical element to creating the future of the grid.”
Strategic & Financial Highlights
- Customer value and innovation: Will enable customers to more rapidly create and maximize project value with the combined company supplying edge controls and a software as a service (SaaS) solution. Customers are expected to benefit from a single, cohesive view to manage and optimize their renewable and storage assets.
- SaaS evolution: Will further accelerate Stem’s growing and recurring revenue and margin contribution from software through the addition of AlsoEnergy’s SaaS offerings. Stem will bring its unique, AI-driven approach to AlsoEnergy’s software to increase efficiencies for customers.
- Market expansion: Will provide significant opportunities to cross-sell and leverage each platform’s extensive customer base. Currently, only 30% of AlsoEnergy’s customers are customers of Stem, reflecting significant embedded growth opportunities.
- Rich dataset: Will leverage a rich dataset of solar and storage operating history. Through Stem’s best-in-class AI-driven analytics platform, Athena®, and AlsoEnergy’s PowerTrack platform, the combined company is expected to enhance future software development and performance, while increasing the combined company’s competitive differentiation.
- Large, international customer base: Will expand the combined company’s geographic footprint to more than 50 countries. AlsoEnergy has a strong base of enterprise, developer, and utility customers to further supplement Stem’s existing partners and customers.