Itron Inc. will pay $830 million to buy a competitor Silver Spring Networks, of San Jose, California, the two companies have announced.
Silver Spring Networks works globally in the smart utility and smart city sectors, with a customer list that includes U.S. and Asian utilities. The sale will accelerate Itron’s growth and innovation in both areas through Silver Springs’ complementary technology, officials said.
The purchase “solidifies our role as the leading provider for utilities and cities in the resourceful use of energy and water,” Philip Mezey, Itron’s president and chief executive, said during a conference call with analysts.
“Joining forces with Itron will enable us to help more utilities and cities adopt the industrial internet, improve their performance and reliability and better position themselves for a connected future,” Mike Bell, Silver Spring Networks’ president and chief executive, said in a news release.
Itron has 8,000 employees worldwide, including 500 at its corporate headquarters in Liberty Lake. The company helps customers in more than 100 countries measure and control their water and energy use, officials said. Itron sells software and communication systems and provides management and consulting services.
Silver Spring Networks had sales of $311 million last year. After the merger, the combined company will have a $2.6 billion backlog in sales, Mezey told the analysts.
The transaction requires approval from Silver Spring Network’s shareholders and U.S. regulators. The deal is expected to close later this year or early in 2018.
Itron will pay $16.25 per share for each outstanding share of Silver Spring Networks, which represents a 25 percent premium over the shares’ closing price Friday.
Itron will finance about $750 million of the purchase.
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