- e2Companies LLC (“e2” or the “Company”) is the creator of the industry’s first Virtual Utility® and a leading provider of integrated solutions for power generation, distribution and energy economics.
- e2 has a track record of sustained revenue growth at a CAGR of 110% since 2021, with unaudited full year 2024 revenue of $28.7 million, and a customer pipeline of more than a billion dollars in qualified opportunities.
- e2 is seeing strong demand for its power solutions across industry sectors. Its current and past customers include Nabors Industries, Liberty Mutual, FedEx, GEICO, Cleveland Clinic, Case Western Reserve University, Erie County Public Works, Frontier Communications, and GlaxoSmithKline.
- e2’s technology addresses several challenges arising from the international growth of data centers, including meeting the volatile power demand and hyper dynamic processing ability of new AI chips, positioning the Company to benefit from the AI data center boom.
- e2 recently announced a strategic collaboration with Nabors Industries Ltd. (“Nabors”) to bring e2’s integrated power solutions to the oilfield and broader energy markets.
- The transaction is expected to provide approximately $400 million in gross proceeds to the new public company, inclusive of approximately $331 million of cash held in Nabors Energy Transition Corp. II’s (“NETD”) trust account (before giving effect to potential redemptions) and proceeds from a private placement of NETD common stock or structured securities or e2 units or structured securities (the “Private Placement”).
- The transaction values e2 at a pre-money equity value of $500 million, providing an attractive entry point for NETD shareholders. e2’s pro forma enterprise value of the new public company is approximately $770 million with a pro forma equity value of approximately $1 billion (each assuming no redemptions and anticipated Private Placement proceeds).
- Existing e2 unitholders and management will roll 100% of their equity holdings into the new public company. The transaction is expected to be completed during the third quarter of 2025.
- The combined entity will be named e2Companies, Inc. and is expected to be listed on Nasdaq under the ticker symbol “VUTL”.
e2Companies LLC, an innovative provider of integrated solutions for on-site power generation, distribution and energy cost-optimization, and Nabors Energy Transition Corp. II (Nasdaq: NETD), today announced a definitive agreement for a business combination (the “Transaction” or the “Business Combination”) that would result in e2 becoming a publicly-listed company on Nasdaq under the ticker symbol “VUTL”.
NETD is primarily sponsored by Nabors Industries Ltd. (NYSE: NBR), a leading provider of advanced technology for the energy industry and one of the world’s largest drilling rig, services and technology providers. e2 recently announced a strategic collaboration with Nabors on integrated power solutions for the oilfield and broader energy markets.
Company Background
e2 is the creator of the energy industry’s first Virtual Utility®, an AI-based platform that delivers integrated hardware and software solutions for on-site power generation, energy storage, distribution and improved energy cost economics to power critical industries such as manufacturing, data centers, oil & gas, and healthcare.
e2’s Virtual Utility® platform delivers uninterruptible, on-site power generation combined with energy storage and grid optimization services through utilization of both hardware and AI-enabled software integrated solutions. Virtual Utility® delivers a resilient and customizable alternative to diesel engines and traditional power grids.
The Company’s patented R3Di® System, the heart of the Virtual Utility®, is a self-contained, turnkey, on-site power hardware system that can operate behind-the-meter without reliance on a grid interconnection and as such is agnostic as to its energy source. The R3Di® system has been verified to save approximately 13,000 tons of CO2 emissions over its lifetime compared to conventional backup power systems and is future proofed for compatibility with a wide range of renewable power generation sources. In addition, the R3Di® system absorbs a higher range of load profiles than conventional backup systems, making it ideal for critical industries with volatile power demand, such as oil & gas and some nascent AI technologies. Grove365®, the system’s AI-powered grid response optimization monitoring software platform, acts as an operational hub, providing real-time data and AI-based predictive analytics.
The Virtual Utility® system addresses several challenges arising from the AI data center boom and global electrification of economies. As worldwide electric grids age, upgrading or replacing infrastructure has become backlogged - at the exact time that calls on the traditional electric grid are increasing faster than ever. Costs and timelines to make the traditional grid capable of meeting this demand have become unacceptable to many, with electric utility interconnections often taking five or more years to be completed, if completed at all. In this environment, localized microgrids, such as those enabled by e2’s systems, have emerged as turnkey solutions for delivering reliability and meeting the world’s growing electricity demand. Additionally, Virtual Utility® is one of the only solutions that stabilizes the hyper-dynamic processing ability of data centers with AI chips, positioning the Company to significantly benefit from the growing power demands of the AI data center boom.
e2’s products and solutions have been deployed, or are contracted to be deployed, at more than 165 sites globally, with customers that include Nabors, Liberty Mutual, FedEx, ESPN, GEICO, Cleveland Clinic, Case Western Reserve University, Erie County Public Works, Frontier Communications, and GlaxoSmithKline. The Company’s Grove365® platform currently monitors 490 assets at 165 locations globally and has operated for a total of over 90 million grid monitoring hours. e2 has demonstrated sustained rapid revenue growth at a CAGR of 110% since 2021, with unaudited full year 2024 revenues of $28.7 million, and believes this transaction will better enable it to continue to capitalize on a customer pipeline of more than a billion dollars in qualified opportunities.
e2’s Flexible Business Model
e2’s business model reflects the diversity of needs of its customers, allowing a range of engagements, from equipment sales and service to full-service energy management.
Under e2’s original equipment manufacturer sales (OEM) model, the Company sells customers R3Di® system hardware to manage provision of power to facilities, whether from a grid interconnection or distributed power generation assets. Typical customer contracts remain in place for 15 years, during which time e2 provides customers with monitoring, maintenance and compliance services for the equipment.
Alternatively, e2’s energy service agreement (ESA) model sees the Company provide comprehensive energy solutions to customers, including installation, operation and maintenance of R3Di® systems at the customer’s site, and generation of on-site power. e2 utilizes its Grove365® to monitor system performance and usage in this full-service model, in which equipment remains on e2’s balance sheet. Contracts for ESA engagements are typically 15 years in duration.
e2 also provides certain fee-based grid monitoring and compliance services through its AI-based Grove365® platform, the data from which further strengthens the AI capabilities of the Grove365® platform to remotely direct e2’s energy management units.
Strategic Collaboration with Nabors Industries
On December 10, 2024, e2 and Nabors, NETD’s primary sponsor, announced a strategic collaboration that will expand e2’s opportunities for integrated power solutions in the oilfield and broader energy markets.
By combining Nabors’ global expertise and relationships in oil and gas and energy transition with e2’s Virtual Utility®, the companies aim to develop and market tailored solutions for the unique demands of the oilfield. e2 and Nabors are jointly discussing strategies, designs and multi-million-dollar purchase orders to deploy e2’s R3Di on-site power units with oilfield customers and other strategic partners. Additionally, the parties expect to collaborate on U.S.-based energy storage solutions to potentially further improve R3Di® system performance.
Oil and gas operations account for 15% of global energy-related emissions and the global market for oil and gas electrification is expected to grow at a 31% CAGR to more than $23 billion by 2030, according to research by Global Market Insights Inc. Companies transitioning away from diesel-powered operations to reduce costs and emissions require reliable microgrid power solutions that avoid overloading electrical grids, especially considering competing demands from the growth in AI and data centers and increasing industrial electrification. The global microgrid market size is projected to reach $87.8 billion by 2029, growing at a CAGR of 18.5% between 2024 to 2029, according to MarketsandMarkets research.
Management Commentary
James Richmond, Executive Chairman and CEO of e2, commented, “Electric power demand is rising rapidly across a variety of sectors in the economy, including data centers, industrials and oil and gas, exceeding historical highs and on pace to outstrip supply. As companies globally electrify their operations to meet decarbonization goals, our power solutions solve the critical issues of grid resiliency and reliability that have become a focal point for ensuring business continuity. Our business combination with NETD and strategic collaboration with Nabors will accelerate the deployment of our integrated power solutions to address the grid instability challenges that have emerged as a result of this growing supply and demand imbalance.”
Anthony Petrello, President and CEO of NETD and Chairman, President and CEO of Nabors, commented, “We believe the e2 solution has clear, value-creating application in the oilfield sector. We will be working together to drive market penetration of e2’s portfolio. Moreover, given the widely acknowledged and increasing challenges to the global electrical grid and surging power demand – driven in part by data centers supporting artificial intelligence and the rapid rise of electrification – we believe e2 is uniquely positioned to capitalize on these market tailwinds. We believe the business combination with NETD will further accelerate e2’s growth and deliver long-term shareholder value while furthering Nabors’ commitment to ‘Energy Without Compromise’ and support of companies on the cutting edge of advanced energy technology.”
Transaction Overview
The Transaction is expected to provide approximately $400 million in gross proceeds to the new public company, inclusive of $331 million of cash held in NETD’s trust account (before giving effect to potential redemptions) and anticipated Private Placement proceeds.
The Transaction values e2 at a pre-money equity value of $500 million, providing an attractive entry point for NETD shareholders. It also implies a pro forma enterprise value of the new public company of approximately $770 million and a pro forma equity value of approximately $1 billion (each assuming no redemptions and anticipated Private Placement proceeds).
e2’s existing management team will continue to lead the Company following the completion of the Transaction. No existing e2 shareholders or management will receive cash (other than payment of certain fees to e2 management) as part of the Transaction, as all will roll 100% of their equity holdings into the new public company. Additionally, e2’s management team, e2’s primary shareholders, NETD’s sponsor and certain affiliates of NETD’s sponsor have committed to customary lock-ups.
The proposed Transaction was unanimously approved by the Boards of Directors of NETD and e2. Completion of the proposed Transaction is subject to customary closing conditions and is anticipated to occur in the third quarter of 2025.
Additional information about the proposed Transaction, including a copy of the business combination agreement and the investor presentation, will be provided in a Current Report on Form 8-K to be filed by NETD with the U.S. Securities and Exchange Commission (the “SEC”) and available at www.sec.gov.
Legal Advisors
Vinson & Elkins LLP is acting as legal advisor to NETD. Haynes & Boone LLP is acting as legal advisor to e2. Milbank LLP is acting as legal advisor to Nabors.
