Itron to Acquire Quantum Consulting Inc.

April 3, 2006
Itron Inc. has signed an agreement to purchase Quantum Consulting Inc., a nationally recognized energy consulting firm based in Berkeley, California

Itron Inc. has signed an agreement to purchase Quantum Consulting Inc., a nationally recognized energy consulting firm based in Berkeley, California.

Quantum Consulting offers a wide range of consulting services relating to energy efficiency and demand response program evaluation, planning, and design, as well as market research. This team will join Itron's existing Consulting and Analysis group to offer a more comprehensive set of consulting and research services spanning energy efficiency and demand response, renewable energy and distributed generation, market research, load research, and general analysis of energy usage and end-user decision making. The group will provide support to major energy utilities, government agencies and other clients throughout North America. The Quantum group will relocate to Itron's Oakland office.

"With intense focus on energy efficiency throughout the country and particularly in the state of California, we wanted to expand Itron's capabilities and offerings in this growing segment of the energy marketplace," said LeRoy Nosbaum, Itron chairman and CEO. "With the addition of Quantum's leadership team and staff, Itron will have one of the most credentialed and respected consulting teams in the country. We are very pleased to have John Cavalli and Mike Rufo coming over to run the Consulting Practice for Itron."

Last year, the California Public Utilities Commission approved $2 billion to spend in 2006 through 2008 on energy efficiency programs, which are designed to reduce the state's energy consumption across households, businesses, schools, local government and other sectors. More than $100 million will be earmarked in California for Evaluation, Measurement & Verification (EM&V) projects.

"These evaluation projects are critical to the optimization of energy efficiency programs and policies, and are well aligned with the successful work both the Quantum and Itron Consulting & Analysis teams have been providing to the market for years," said John Cavalli, Quantum's CEO, and post acquisition, managing director of the combined Itron consulting organization. "Combining Quantum's core competencies--energy program evaluation, program design and market research, with Itron's capabilities, further expands Itron's leadership and position in a market that we anticipate will grow over the next several years."

The transaction was expected to close April 1. An initial purchase payment of $4 million will be paid in cash, subject to escrow provisions. Additional payments of up to $2 million may also be made based on the achievement of revenue and profitability targets and retention of key staff over three years post close.

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