Silver Spring Networks to buy utility data analytics solution provider Detectent for US$12m cash
Redwood City, CA, USA – Silver Spring Networks, Inc. has agreed to acquire privately held Detectent, Inc., a provider of utility data analytics solutions for approximately US$12 million in cash.
The move aims to bolster SSNI’s management of Big Data, while broadening its software and SaaS solutions to address critical utility needs, reports Jeremy Cowan. Based in Escondido, California, Detectent’s software-as-a-service (SaaS), subscription and other solutions help utilities to improve advanced metering infrastructure (AMI) and utility grid operations, ensure revenue protection, and deliver enhanced customer engagement programmes.
Detectent’s solutions currently analyse data from more than 25 million water, gas, and electricity meters, in both AMI and legacy environments, from over 20 leading utility customers across the United States. Detectent has been a Silver Spring partner since May 2014 with its solutions offered through Silver Spring’s SilverLink™ Sensor Network apps catalogue.
“As a recognised industry leader, Detectent is delivering innovative data analytics solutions to some of the leading U.S. utilities,” said Scott Lang, chairman, president and CEO of Silver Spring Networks. “We are excited to enhance the Detectent analytics solutions with our SilverLink platform’s distributed intelligence and real-time data stream capabilities. We are also pleased to broaden our market reach by serving Detectent’s impressive customer line-up and extending these innovations to our global client base.”
“Energy theft is a multi-billion dollar challenge for the utility industry. Coupled with operational improvements and enhanced customer engagement, there is a growing opportunity to unlock billions of dollars in value by applying data analytics solutions,“ said Michael Madrazo, CEO of Detectent. “Silver Spring has a proven track-record with blue-chip utilities around the globe, has connected more than 20 million devices worldwide, and is delivering the next generation platform to transform real-time smart grid data into knowledge and action. As we prepare to join the Silver Spring family, we are excited by the enhanced value we can create globally.”
Detectent’s utility analytics solutions will be offered either as a stand-alone solution or powered by Silver Spring’s smart grid big data platform – the SilverLink Sensor Network. The SilverLink Sensor Network is said by the company to unlock big data on the smart grid at up to 10x the speed and 1/10th the cost of traditional utility IT infrastructure. With fully networked devices across its grid, a utility can easily and quickly organise, program, and use smart grid big data for a more agile and innovative organisation.
The deal is expected to contribute towards SSNI’s corporate strategy of increasing recurring revenue per cumulative network end-point. Detectent’s gross margins are higher than Silver Spring’s corporate gross margins due to a high mix of SaaS, services and software sales. Excluding deal-related charges, Silver Spring (NYSE: SSNI) expects the transaction to be neutral to non-GAAP earnings in 2015, and accretive beginning in 2016. The transaction is expected to close in the first quarter of 2015, subject to customary closing conditions.
As to the question, “Does Silver Spring plan to acquire other companies? Silver Spring would only say that it “continually explores opportunities that support our long-term strategy.”