Morgan Stanley Capital Partners Acquires Resource Innovations
Morgan Stanley Capital Partners acquires Resource Innovations, a tech-enabled services company focused on energy efficiency and sustainability. Founder Lauren Casentini remains CEO. The company provides advisory services, program management, and software to utility, government, and corporate clients. The acquisition aims to continue RI's growth and leadership in clean energy transition.
The acquisition of Resource Innovations by Morgan Stanley Capital Partners signifies a strategic move within the energy efficiency and sustainability sector. This transaction highlights a growing trend where investment funds are increasingly targeting companies that align with global sustainability goals and have a technological edge. Resource Innovations, with its focus on tech-enabled services in energy efficiency, decarbonization and support for utilities, positions itself at the nexus of technology and sustainability—a sweet spot for investors looking for growth in sectors underpinned by long-term policy tailwinds.
From a market perspective, the demand for energy efficiency solutions is on the rise, driven by policy changes and increased societal focus on climate change. The company's ability to tap into emerging growth areas like electric vehicle charging and distributed solar indicates potential for capturing market share in fast-growing segments. The emphasis on organic growth and M&A as pathways for expansion suggests an aggressive strategy to consolidate market position and diversify offerings. This could potentially lead to increased revenue streams and a more robust competitive stance.
Examining the financial implications, Morgan Stanley Capital Partners' third investment in the industrials and outsourced services sector signals a pattern of diversification and targeted growth. The focus on Resource Innovations, a company with a consistent track record of growth, may suggest a positive outlook on return on investment. By acquiring a controlling interest, MSCP is likely to integrate Resource Innovations' operations closely with its existing portfolio, seeking to leverage synergies and enhance profitability.
Investors should note the potential for increased operational efficiencies and market expansion through strategic M&A activities. However, they should also be aware of the risks associated with the integration of such acquisitions, including potential cultural clashes and the challenge of maintaining innovation pace while scaling operations. The involvement of the company's founder, who remains as CEO and a significant equity holder, could be pivotal in preserving the entrepreneurial spirit and continuity of the company's strategic direction.
The acquisition's alignment with energy policy goals is particularly noteworthy. Resource Innovations is positioned to play a important role in the implementation of energy policies aimed at reducing greenhouse gas emissions and improving grid resiliency. The company's advisory services and program management are likely to be in high demand as the United States continues to navigate the clean energy transition.
Investors should consider the long-term policy environment and the potential for regulatory changes that could either bolster or impede the growth of companies like Resource Innovations. The focus on sustainability and decarbonization also opens up opportunities for government incentives and partnerships, which could further enhance the company's growth prospects and, by extension, the value of MSCP's investment.
04/02/2024 - 09:00 AM
NEW YORK & SAN FRANCISCO --(BUSINESS WIRE)--
Investment funds managed by Morgan Stanley Capital Partners (“MSCP”), the middle-market focused private equity team at Morgan Stanley Investment Management, today announced it has acquired Resource Innovations (“RI” or the “Company”), a leading tech-enabled services company focused on energy efficiency and sustainability. Under the terms of the agreement, MSCP acquired a controlling interest in the Company from BV Investment Partners and certain other shareholders. Founder Lauren Casentini will continue as the Chief Executive Officer of RI and remain a significant equity holder in the Company following the completion of the transaction.
Headquartered in the San Francisco Bay Area , RI provides advisory services, program management services and software to utility, government and corporate clients in the areas of energy efficiency and decarbonization with the goal of lowering energy costs, reducing waste, cutting greenhouse gas emissions and improving grid resiliency. The Company is a recognized leader in working with utilities to develop and implement both traditional energy efficiency programs, including lighting, weatherization and controls, as well as emerging growth areas such as electric vehicle charging, distributed solar and demand response.
Commenting on the acquisition, Eric Kanter, Managing Director and Head of Industrial Services at MSCP, said: “Resource Innovations’ tech-enabled services help turn energy policy goals into reality. The Company supports core energy efficiency needs while seeking to address the next phase of clean energy transition challenges being faced across the United States . We believe the Company’s record of consistent growth and ability to expand into these emerging areas with tremendous market potential have paved the way for continued opportunity. Under industry veteran Lauren Casentini’s leadership, we believe this purpose-built team is poised for the next step in helping communities on their energy transition journey. We look forward to working together as we seek to advance RI’s leadership position and continue expanding the company through organic growth and M&A.”
Ms. Casentini stated, “MSCP’s investment is a recognition of the tremendous growth we have experienced over the past several years and validates the hard work our team does to deliver innovative, differentiated solutions for our customers. I look forward to working together with Morgan Stanley Capital Partners to continue to grow our Company.”
MSCP’s acquisition of Resource Innovations represents its third investment in industrials and outsourced services, following the acquisition of Apex in 2023 and Alliance Technical Group in 2021.
Jones Day served as legal counsel to MSCP and Harris Williams served as financial advisor. Global Counsel served as MSCP’s regulatory and policy advisor. Latham & Watkins served as legal counsel to Resource Innovations and BV Investment Partners, and Jefferies LLC served as financial advisor.
About Morgan Stanley Capital Partners
Morgan Stanley Capital Partners, part of Morgan Stanley Investment Management, is a leading middle-market private equity platform established in 1986 that focuses on privately negotiated equity and equity-related investments primarily in North America . Morgan Stanley Capital Partners seeks to create value in portfolio companies primarily in a series of subsectors in the business services, consumer, healthcare, education and industrials markets with an emphasis on driving significant organic and acquisition growth through an operationally focused approach. For further information about Morgan Stanley Capital Partners, please visit www.morganstanley.com/im/capitalpartners .
About Morgan Stanley Investment Management
Morgan Stanley Investment Management, together with its investment advisory affiliates, has more than 1,300 investment professionals around the world and $1.5 trillion www.morganstanley.com/im .
About Resource Innovations
Resource Innovations is accelerating the transition to clean energy, serving as a trusted partner to utilities and governments in energy efficiency and decarbonization planning. Since its inception in 2016 under a bold and urgent vision to address climate change and energy equity, Resource Innovations has been included in the Inc. 5000 List of America’s Fastest Growing Companies three times. Visit resource-innovations.com to learn more about how we are accelerating the clean energy transition and leading the charge to power change.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240401717430/en/
Morgan Stanley: Alyson Barnes
alyson.barnes@morganstanley.com
Resource Innovations: Stephanie Reynolds
press@resource-innovations.com
Source: Morgan Stanley Capital Partners
What company did Morgan Stanley Capital Partners acquire?
Morgan Stanley Capital Partners acquired Resource Innovations.
Who will continue as the Chief Executive Officer of Resource Innovations?
Founder Lauren Casentini will continue as the Chief Executive Officer of Resource Innovations.
What services does Resource Innovations provide?
Resource Innovations provides advisory services, program management services, and software to utility, government, and corporate clients in energy efficiency and sustainability.
Where is Resource Innovations headquartered?
Resource Innovations is headquartered in the San Francisco Bay Area.
What are the key goals of Resource Innovations in energy efficiency and sustainability?
Resource Innovations aims to lower energy costs, reduce waste, cut greenhouse gas emissions, and improve grid resiliency.
