GE Vernova Selling Manufacturing Software Business For $600M
The leaders of GE Vernova Inc. have agreed to sell a part of its software portfolio that focuses on manufacturing operations to a big name in the global investment space for $600 million.
The deal between GE Vernova and TPG calls for the purchase of Proficy to be completed in the first half of next year. Proficy markets a range of software offerings to more than 20,000 customers around the world in manufacturing as well as transit and infrastructure. The business has revenues of nearly $200 million and accounts for about 20% of GE Vernova’s broader electrification software sales.
Speaking at Morgan Stanley's 13th Annual Laguna Conference after the transaction was announced on Sept. 11, President and CEO Scott Strazik said the planned Proficy sale to TPG—which manages roughly $270 billion via various platforms—is about focusing GE Vernova’s software work on energy-related applications.
“When I would go on a customer visit, it was to go meet Procter & Gamble, [which] leverages that solution in all their factories,” Strazik said. “Procter & Gamble is a great customer but that’s not our core business.”
Strazik connected the Proficy deal to his team’s acquisition this summer of French firm Alteia SAS, which specializes in visual data and artificial intelligence tools, particularly in support of utility grid operations. Continuing to build out GE Vernova’s GridOS portfolio, Strazik told the Laguna conference, is “a critical part of our future” even if the dollar figures aren’t yet very important to the company as a whole. But the opportunity is large, the CEO said.
“We’re nurturing this business. We’re focusing it,” Strazik said. “With the complexity that our customers are managing the grid every day—by directional flow of electrons, distributed energy resources, think solar panels on houses, think increased renewables penetration rate with intermittent planning dynamics, wildfires—our customers are craving a more holistic solution for grid software. Because today, to a large extent, they have homegrown solutions that don’t talk to each other very well.”
Shares of GE Vernova (Ticker: GEV) were down about 1% to roughly $636 on the heels of the Proficy news and Strazik’s talk at Laguna. But they have more than doubled over the past six months, a surge that has grown the company’s market value to more than $170 billion.
About the Author
Geert De Lombaerde
Senior Editor
A native of Belgium, Geert De Lombaerde has more than two decades of business journalism experience and writes about markets and economic trends for Endeavor Business Media publications T&D World, Healthcare Innovation, IndustryWeek, FleetOwner and Oil & Gas Journal. With a degree in journalism from the University of Missouri, he began his reporting career at the Business Courier in Cincinnati and later was managing editor and editor of the Nashville Business Journal. Most recently, he oversaw the online and print products of the Nashville Post and reported primarily on Middle Tennessee’s finance sector as well as many of its publicly traded companies.