Sun Capital sells infrastructure tech biz, as deal value in utilities sector increases
As the year comes to a close, Sun Capital Partners Inc. has agreed to sell Aclara Technologies LLC, provider of smart infrastructure technology, to Hubbell Power Systems Inc. The deal is valued at approximately $1.1 billion.
Aclara supplies smart meters and a variety of other field devices used to manage and power utility services. The St. Louis-based target also provides advanced metering infrastructure, software, and related services to more than 800 water, gas and electric utilities. The agreement comes as deal activity in the power and utilities sector presented a strong total deal value in the third quarter of 2017, one of the highest quarterly deal values since Q3 2016, according to a recent deal insights study by PricewaterhouseCoopers LLP.
The buyer, Hubbell Power Systems, is a subsidiary of Hubbell Inc. (NYSE: HUBB). Aclara was formed by Sun Capital as an independent business when it was acquired by the PE firm in 2014 from a corporate parent. The Columbia, South Carolina-based buyer is purchasing Aclara following four add-on acquisitions from carve-out deals.
“During our investment period, we were able to invest in and improve the business while also quadrupling EBITDA,” according to a Sun Capital spokesperson. “Development of new products and capabilities increased Aclara’s addressable market five-fold, and resulted in a robust backlog of contracted sales of approximately $1 billion.”
Sun Capital, founded in 1995, is a global private equity firm based in Boca Raton, Florida. The PE firm has more than $9.2 billion in capital under management and has invested in more than 300 companies across a variety of industries, including: consumer products and services, food and beverage, industrial, packaging, chemicals, building products, automotive, restaurant and retail.
Sun Capital targets companies with between $50 million and $500 million in sales, but also targets companies with up to $1.5 billion in revenues. The firm previously sold memory foam manufacturer Innocor Inc. and gas store brands Admiral Petroleum Co. and Lemmen Oil Co.