Generac to make acquisition, expand plant

Generac Holdings Inc. a global designer and manufacturer of energy technology solutions and power products, said it has signed an agreement to acquire ecobee Inc., a supplier of sustainable smart home solutions. The transaction is valued at up to $770 million contingent on the achievement of certain performance targets.

A pioneer in the smart thermostat market, ecobee was founded in 2007 and is headquartered in Toronto, Canada. With a team of over 500 employees globally, ecobee currently offers several Energy Star-certified thermostats and a suite of home monitoring products, all designed with a focus on conservation, convenience, peace of mind and comfort. ecobee’s smart thermostats intelligently optimize heating and cooling systems to deliver significant energy savings for homeowners. With over two million connected homes, ecobee customers in North America have saved more than 20 TWh of energy, which is the equivalent of saving enough energy to take all the homes in Los Angeles off the grid for an entire year.

“ecobee’s solutions are an important addition to Generac’s extensive residential energy technology portfolio,” said Aaron Jagdfeld, president and chief executive officer of Generac. “Residential HVAC systems represent the largest energy-consuming device in the home today and ecobee’s smart thermostats and sensors offer the most intelligent way to balance comfort with conservation.

“In addition, the ability to combine ecobee’s cutting-edge technologies with Generac’s power generation, energy storage and energy management devices will allow us to create a clean, efficient, and reliable home energy ecosystem that will not only save homeowners money, but also help grid operators meet the challenges of an electrical grid under enormous stress by providing solutions to better balance supply and demand.”

At closing and subject to customary adjustments, Generac will pay $200 million in cash along with $450 million in GNRC common stock to the current equity holders of ecobee. Additionally, upon achievement of certain performance targets between closing and June 30, 2023, the sellers may receive up to $120 million in additional shares of GNRC common stock.

“Generac’s evolution into an energy technology solutions company creates many opportunities to integrate our ecobee products with their residential device offerings, enabling direct monitoring and control of a significant portion of the home’s electrical load,” said Stuart Lombard, founder and chief executive officer of ecobee. “We are excited to join the Generac team so together we can deliver a cleaner, more resilient and sustainable energy future for our customers and communities.”

The acquisition is expected to close during the fourth quarter, subject to customary closing conditions.

Expansion in South Carolina

Generac also announced that it will expand its footprint and operations at its manufacturing, assembly, and distribution facility in Trenton, S.C. The move is intended to increase the company’s distribution capacity in the southeastern United States.

The expansion, which is expected to be complete by the third quarter of 2022, will add 200,000 sq. ft. to the facility, increasing the current size of the building by nearly 50%, and will create additional space for the warehousing of raw materials and storage of finished goods, Generac said.

“Generac has experienced tremendous growth over the past decade,” Jagdfeld said, “and demand for our products continues to be exceptional as the combination of an aging grid and extreme weather are resulting in more frequent and longer lasting power outages, and that demand has only intensified in the last year and a half with more people needing backup power as they spend much more time at home doing everything from working to learning to shopping. In further expanding our footprint in Trenton, we will be better able to meet the growing demand we are experiencing for Generac’s home standby generators and associated energy technologies.”

Generac purchased the 421,000 sq. ft. facility located at 30 Generac Way in February 2021. Operations at the facility began in early July.