Navigation Capital Partners (NCP), an Atlanta-based middle market private equity firm, has teamed with Robert Shively to target acquisition opportunities to build an industry leader in the Intelligent Infrastructure sector. NCP is seeking companies that, when combined, will enable the integration of services, software and hardware to offer a set of products that significantly improves operating results, increases productivity and reduces waste. Target vertical markets include energy management, water management, asset/fleet management and traffic management.
Shively has joined NCP’s “Executive-in-Residence” program to help lead the search. NCP’s “Executive-in-Residence” program is the firm’s approach to identify experienced leadership within an industry attractive for investment, and then search as a team for the right companies to acquire. NCP has also engaged investment banking firm TM Capital Corp., with offices in Atlanta, Boston and New York, to support this initiative.
Companies in the Intelligent Infrastructure space have organized mainly by industry verticals – utilities, municipalities, water and wastewater sectors – but the NCP team believes significant value and economic benefits exist by cross-pollinating products and services across these sectors. Large-scale owners of disparate infrastructure (wires, pipes, roads, etc.) have a need to track critical information in order to optimize their investments and reduce waste. Centralizing the necessary monitoring services (such as data collection, organization, hosting, analyzing and reporting), software solutions and business services within a single integrated solution could improve both utilization and management of infrastructure investment.
“The need to manage resources, reduce waste and replace outdated infrastructure has never been greater, and the technology for that management has never been more accessible and affordable,” said Larry Mock, managing partner of NCP. “By combining industry experts in services, software and hardware, we plan to create an industry leader offering an all-in-one option to the marketplace.”
One representative opportunity is in energy management, with the “smart grid” concept for modernizing the nation’s aging electricity infrastructure. According to a report* by GP Bullhound Ltd., an independent technology research firm, the “smart grid” is defined as combining “network communications, analytics, feedback and control” for power grid systems with goals of improved efficiency and reduced environmental impact. The economic benefits of transforming the current electric distribution system to a smart grid are estimated at $15 – $20 billion in saved energy consumption, according to a Galvin Electricity Initiatives study cited by GP Bullhound. Additional projected benefits include almost $50 billion in outage prevention cost-savings as well as a reduced investment requirement of $15-17 billion per year. Savings of these magnitudes translate into significant opportunities for well-positioned, intelligent solutions providers.
Many companies in the Intelligent Infrastructure space are not yet of critical mass or size; therefore, combining several entities will help build mass, broaden capabilities and provide operating efficiencies.
“Intelligent Infrastructure is a widely fragmented landscape, but certain pockets of activity exist where smaller, nimble companies are developing leading technology and expertise,” said Mock. “Many of these companies could be on the cusp of expansion, but lack the capital to build scale and aggressively take advantage of current market momentum. We’re committed to partnering with some strong players to enable a broader strategy.”
NCP is targeting companies that currently provide services, software solutions and/or hardware capabilities to customers in the utility sector, water sector, transportation sector and municipality/DOT sector that ideally possess the following characteristics:
* A preferred range of $20 million to $100 million in revenue;
* A history of sustained profitability, and
* EBITDA of $3 million plus.
Shively, who will lead the platform company, plans to leverage the expertise and experience of existing senior executives within the acquired companies. The leadership team will be augmented with additional seasoned veterans as needed. Shively has substantial experience building, operating and growing industry-leading business services outsourcing companies, and leading companies that serve the utility, municipal and telecommunications sectors. He was most recently president of SM&P Utility Resources, a business services outsource provider, and has held senior executive positions at Laclede Group and ScottMadden.
Please contact Robert Shively at 317.750.0140 or firstname.lastname@example.org with ideas of companies that may fit the profile listed herein.
About Navigation Capital Partners
Navigation Capital Partners (NCP) is an Atlanta-based private equity firm that makes growth and buyout investments in middle market niche manufacturing, distribution and business services companies across the United States. The managers of NCP formerly founded and managed Mellon Ventures, the private equity investment partnership of Mellon Financial Corporation. With the backing of Goldman Sachs Vintage Funds, NCP acquired the private equity portfolio of Mellon Ventures in December 2006. NCP currently manages approximately $375 million of invested and committed capital. For more information, visit www.navigationcapital.com.