UTC’s Acquisition of Wipro’s EcoEnergy Demonstrates Once Again the Shift From Pure Energy Management to Building Optimisation
On November 30, 2016, IT services major Wipro announced it is selling its EcoEnergy business division to Chubb Alba Control Systems, a subsidiary of US-based conglomerate United Technologies Corporation (UTC), for $70 million ( 480 crore). Chubb Alba Control Systems, a provider of building controls systems including HVAC, plans to develop its remote monitoring and building analytics capabilities with the acquisition of EcoEnergy. Wipro announced that it is divesting EcoEnergy so that it can focus on its core IT outsourcing business.
Over the past year, UTC’s Climate, Controls & Security division has made several investments in its product line up across building optimization. For example, UTC subsidiary Carrier, an HVAC technology solution provider, launched Côr smart home automation system earlier this year, which provides homeowners access and remote control of their heating, cooling, safety and security systems. UTC’s Climate, Controls & Security division’s leading brands, including Carrier, Riello, Chubb, Edwards, Onity, Automated Logic, Lebel, Interlogix and Kiddle will offer the EcoEnergy solution to their customers.
This deal reflects two major trends taking place in the real estate, energy and facilities management market. Firstly, remote management continues to be a hot technology for delivering energy services and fault detection cost-effectively and at scale. In November 2016, Rheem and Powerhouse Dynamics announced a new partnership to install SiteSage sensors on Rheem’s H2AC Rooftop Units, to provide remote access and control to diagnostic data of HVAC and other facility equipment. Facilities management services provider Carillion recently announced it will open an energy operations center later in December to centrally provide remote BMS monitoring and control, and energy data management.
Secondly, this deal highlights once again that offering a standalone energy management service is tough. The pressure is on energy management specialists to either expand their proposition to look at facilities optimization in a broader sense, or consider exiting the market through selling to a broader software vendor or a services firm.
For more insights on acquisitions in the real estate and facilities management software market see our report Acquisitions Spree Will Trigger A New Wave Of Deals In Real Estate And Facilities Management Software.