Verisk (Nasdaq:VRSK), a leading data analytics provider, has signed a definitive agreement to acquire PowerAdvocate, an industry-leading provider of market, cost intelligence, and supply chain solutions serving the energy sector. PowerAdvocate is based in Boston, Massachusetts.
PowerAdvocate’s proprietary, one-of-a-kind spend and cost data is curated from millions of transactions across thousands of services, materials, and equipment categories in the energy industry. As a result, PowerAdvocate uniquely supports enterprise performance by providing insight into its customers’ cost savings opportunities. Through its proprietary data set encompassing $2.7 trillion of spending data, and machine-learned methods, the company brings transparency to otherwise opaque markets and ensures that capital can be deployed in an efficient manner.
The purchase price is $200 million in cash, funded through existing bank facilities, subject to typical closing adjustments, and an earnout of up to $80 million, subject to the achievement of specific return goals. PowerAdvocate’s 2017 revenue is expected to be approximately $36 million and is expected to grow at a substantially higher rate than Verisk’s historical average organic annual growth rate of 7 to 8%. Estimated 2017 EBITDA for PowerAdvocate is expected to be approximately $11 million. The transaction is expected to be accretive to 2018 adjusted EPS. In addition, Verisk expects the acquisition to generate an attractive return in excess of Verisk’s cost of capital. The transaction is expected to close in the fourth quarter of 2017, subject to the completion of customary closing conditions.
Verisk will discuss the transaction and PowerAdvocate’s products and business in greater detail at its upcoming Investor Day on December 7, 2017.
PowerAdvocate is a leading provider of spend and cost market intelligence. Developed to support customers’ informed decision making, its proprietary solutions enable energy executives to restructure costs and improve company performance. PowerAdvocate supports more than 80 energy companies primarily in the United States but increasingly internationally. Founded in 1999, PowerAdvocate is headquartered in Boston and has an additional office in San Francisco. For more information, visit www.poweradvocate.com.
Source: Verisk Press Release