KUHN CAPITAL Monday, March 19, 2018
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SPL + CES = "Grid Management"

May 5

SPL, New Jersey-based vendor of utility customer information systems, announced today that it will buy in June most of CES, a leading utility industry outage management player. Deal terms were not released.

"Grid reliability is a major issue around the world," said SPL CEO Harry Debes. "It is the backbone of customer service. By joining these [SPL and CES] market-leading product lines, teams, and customer bases together, SPL will provide utilities... with a greatly expanded menu of opportunities to improve service at a lower cost."

This argument for reduced cost and improved servce is most compelling in less regulated utility environments where prices or rates are set more by competition and the quality of services offered than by regulatory fiat. Such environments are currently more commonplace overseas than in the US, so SPL's initial relatively greater focus on non-US locales for the combined entity makes sense until deregulation resumes in the US.

Another argument for the combination lies in its strengthening of SPL's "one-stop shop" claim -- that is, the resulting company will occupy a larger IT footprint within the client, thereby fending off competition from much larger but less utility-focused enterprise system vendors.

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