Ericsson has acquired a new addition to its growing smart city platform, paying $7.5m to buy Ambient out of bankruptcy.
US Bankruptcy Judge Kevin Gross has approved the offer for Massachusetts-based Ambient, which has scored some early plaudits for its smart grid technology, but had then lacked the scale to turn that good feeling into a viable business.
Ambient, which was founded in 1996, filed for Chapter XI protection on July 28, saying it had struggled to push its smart grid data collection devices beyond its flagship customer, Duke Energy. In its most recent fiscal year, it made losses of about $17.8m on sales of $11.4m. It biggest shareholder and lender was Vicis Capital Master Fund.
“While Ambient’s nodes helped Duke achieve its smart grid initiative in Ohio, Ambient to date has been unable to monetize additional opportunities with Duke or elsewhere in the marketplace, primarily as a result of Ambient’s relative small size in the industry and general financial instability,” CEO John Joyce said in court filings.
Ericsson has that market weight, of course, and will be able to push Ambient’s innovations through its Global Services organization. As the Swedish giant pointed out in its statement, that group has 64,000 employees in 180 countries. It said it was interested in Ambient for its “innovative platform which enables utilities to deploy and integrate multiple smart grid applications and technologies, in parallel on a single communications infrastructure. As part of Ericsson, Ambient’s platform will help utilities to maximize their investments in smart grids.”
The Ambient platform provides utilities with a secure, two-way, open IP network architecture which can support multiple communications in parallel, including cellular, WiFi, RF and powerline, as well as serial and Ethernet. A range of applications can be integrated, including smart metering, demand response, distribution automation and monitoring, and direct load control into a common infrastructure.
Ambient also provides product and software maintenance and implementation services, and consulting services.
Magnus Mandersson, head of the global services organization, said: “At Ericsson we are increasingly using our experience in communications and providing managed services for networks that serve more than onebn subscribers worldwide to assist partners and customers in the utilities sector. We’re helping utilities to adopt new types of applications and enable new business models, and I believe Ambient could make a big contribution to that effort.”