Special Report: Buddy Platform is shining a little brighter after announcing it will acquire smart lighting company LIFX for US$51 million (AU$70.5 million).

The IoT and smart spaces company (ASX: BUD) will add the LIFX business to its portfolio, expanding its offering into smart lighting solutions.

Buddy says the acquisition offers will open doors to  the residential sector while also giving LIFX a way into the commercial sector.

The company’s  ‘Fitbit for buildings’ solution, known as Buddy Ohm, enables users to track and measure energy consumption and helps them understand what’s chewing up energy.

Until now, the technology has been geared toward commercial buildings.

LIFX, on the other hand, is a direct-to-consumer smart lighting company with a line of IoT enabled solutions for homes.

Marc Alexander, LIFX co founder and CTO, David McLauchlan, Buddy CEO, and Tim Peters, LIFX CEO

Deal backed by leading ‘instos’

Buddy had the support of new and existing institutional investors and raised a total of US$18.1m to bankroll the deal, which was led by Bell Potter Securities.

The deal is made of US$26.5m payable in cash and US$24.5m fully paid ordinary shares that will be issued to LIFX shareholders.

The company is in the process of finalising a chunk of debt to fund the remaining portion of the deal and says it will update shareholders on the financing in an ASX announcement.

Also joining the BUD register will be the early investors in LIFX, that include Silicon Valley venture capital fund Sequoia Capital, Qualcomm Ventures and Blackbird Ventures– all of which will receive BUD scrip in return for their LIFX holding.

A match made in smart energy heaven

Buddy CEO David McLauchlan says that the LIFX acquisition makes ‘perfect sense’.

“As the demand from both commercial and retail customers for energy monitoring solutions increases, it makes perfect sense that we look to combine our Buddy Ohm platform with a product that can be found in every building and every space in the world – lighting.

“We have a joint vision to meaningfully advance the movement to create smarter spaces globally, and together believe we can achieve some truly enormous goals, he added.

LIFX generated $38.5m in revenue in the 2018 calendar year and the acquisition is expected to be highly earnings accretive for both businesses.

The CEO of LIFX is equally as enthused by the deal, with CEO Tim Peters saying, “We are very excited to join forces with Buddy to expand our customer-base, further our reach, introduce real-time energy monitoring from our lights and enter new and exciting markets.”

With the market for IoT smart building technology expected to hit $US51.4 billion by 2023, Buddy is optimistic about the opportunities up for grabs.

 

 

 

Buddy Platform is a Stockhead advertiser.
This advice has been prepared without taking into account your objectives, financial situation or needs. You should, therefore, consider the appropriateness of the advice, in light of your own objectives, financial situation or needs, before acting on the advice. If this advice relates to the acquisition, or possible acquisition, of a particular financial product, the recipient should obtain a disclosure document, a Product Disclosure Statement or an offer document (PDS) relating to the product and consider the PDS before making any decision about whether to acquire the product.

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