The deal represents a bet on energy transition, as power utilities, grid operators and renewable energy developers turn to simulation software to fine-tune use of production capacity and maximize efficiencies.
The two buyout firms will each hold a 50% stake, the sources said, requesting anonymity ahead of an official announcement expected later on Tuesday. Energy Exemplar’s existing owner, private equity firm Riverside Company, will cash out, they added.
Vista, Blackstone, Riverside and Energy Exemplar declined to comment.
Energy Exemplar has grown at an annual compound rate of 30% since 2018 under Riverside’s ownership, the sources said. The North Adelaide-based company provides software tools that are used by more than 500 companies in 79 countries to simulate and forecast the electric, water, gas and renewable energy markets.
Blackstone is investing in Energy Exemplar through its energy transition arm, which is in the process of raising a new fund. Dubbed Blackstone Energy Transition Partners IV, the fund had raised $2.2 billion towards its $5.6 billion target as of the end of August, according to a filing with the U.S. Securities and Exchange Commission.
The New York-based buyout firm has been moving aggressively into this area, declaring last year that it saw an opportunity to deploy $100 billion in energy transition and climate change solutions projects over the next decade.
Its previous investments include Transmission Developers, solar mounting firm Esdec, environmental engineering firm Geosyntec, environmental commodity exchange Xpansiv, and renewable energy firm Invenergy. Blackstone also said in August it had raised the largest credit fund in the world dedicated to energy transition, amassing $7.1 billion.
Vista, a software sector specialist, is participating in the deal through its middle-market Foundation strategy. The firm raised its fourth Foundation fund in 2020, amassing $4.5 billion, and is expected to raise a new one in the coming months.