Update On Merger Of OhmConnect With Assets From Google Nest’s Renew -- EnergyChoiceMatters.com

Update On Merger Of OhmConnect With Assets From Google Nest’s Renew

December 29, 2023

Email This Story
Copyright 2010-23 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

The following story is brought free of charge to readers by VertexOne, the exclusive EDI provider of EnergyChoiceMatters.com

OhmConnect, Inc. ('OhmConnect'), Resi Station, LLC ('Resi Station'), and Renew Home VPP, LLC ('Renew Home VPP,' and together with OhmConnect and Resi Station, the 'Applicants') filed for FERC authorization for a proposed three-part transaction (the 'Proposed Transaction'), after which the Applicants will be subsidiaries of Renew Home, LLC ('Renew Home'), which will be an indirect subsidiary of Alphabet Inc. ('Alphabet'), Ontario Teachers’ Pension Plan Board ('OTPPB'), StepStone Group, LP ('StepStone'), SIP ManagementCo, LLC ('SIP ManagementCo' and, together with Alphabet, OTPPB, and StepStone, 'Relevant Parties') and certain individual equity holders as discussed below.

OhmConnect is currently a platform company of Sidewalk Infrastructure Partners, LLC (SIP). SIP was previously formed as an independent entity out of Alphabet (Google's parent) in partnership with outside capital providers

Applicants stated, "Individuals Matt Duesterberg and Cadir Lee are the current ultimate upstream affiliates [sic] of OhmConnect."

As noted below, only one investor, Resilia PlatformCo, LLC ('Resilia PlatformCo'), currently holds 10 percent or more of OhmConnect’s outstanding securities. Resilia PlatformCo is an indirect subsidiary of Sidewalk Infrastructure Partners, LLC ('SIP, LLC'). Each of the following entities currently directly or indirectly holds a 10% or greater voting interest in SIP, LLC: (i) Alphabet, (ii) OTPPB and (iii) SIP ManagementCo. Notably, Resilia PlatformCo’s current ownership interests in OhmConnect consist solely of passive rights that are necessary to protect Resilia PlatformCo’s investments and do not confer control over OhmConnect, the Applicants said

In an announcement, SIP stated, "We will combine our platform company, OhmConnect, with assets from Google Nest’s Renew service business to form Renew Home, a new company that will help customers and energy providers unlock energy savings and rewards in a way that supports a clean energy grid. Renew Home will combine OhmConnect’s innovative home energy management platform, which has helped California avoid dangerous blackouts, with Google Nest’s leadership in energy products and services that help customers prioritize cheaper and cleaner energy. This new company will power the Nest Renew service going forward."

SIP is investing $100 million, "in fresh capital to drive its [Renew Home's] future growth as a SIP platform company."

"[W]e believe that Renew Home, working with partners across the industry, will help accelerate the growth of the virtual power plant (VPP) industry, a critical step to enabling the more dynamic energy grid we need to power a carbon free-future," SIP said

Among other things, Applicants OhmConnect and Resi Station, which is an indirect, wholly owned subsidiary of OhmConnect, operate virtual power plants, aggregating residential demand response accounts and participating in certain FERC-jurisdictional markets.

In prior regulatory filings, Texas retail electric provider OhmConnect Texas LLC has been identified as a subsidiary of OhmConnect, Inc., the entity subject to the merger agreement

"Individuals Matt Duesterberg and Cadir Lee are the current ultimate upstream affiliates [sic] of OhmConnect. Only one investor, Resilia PlatformCo, LLC ('Resilia PlatformCo'), currently holds 10 percent or more of OhmConnect’s outstanding securities. Resilia PlatformCo is an indirect subsidiary of Sidewalk Infrastructure Partners, LLC ('SIP, LLC'), the ownership of which is described [above]. Resilia PlatformCo’s current ownership interests in OhmConnect consist solely of passive rights that are necessary to protect Resilia PlatformCo’s investments and do not confer control over OhmConnect," Applicants said

In the first part of the Proposed Transaction (the 'OhmConnect Merger'), OhmConnect will become a direct, wholly owned subsidiary of Renew Home, which in turn, will be indirectly owned and controlled by Alphabet, OTPPB, SIP ManagementCo and certain individual equity holders.

Google LLC ('Google') will, as a result of the OhmConnect Merger, become the holder of a 10% or greater voting interest in Renew Home.

More specifically, "In the first part of the Proposed Transaction, Google will acquire a 10% or greater interest in Renew Home, and pursuant to the confidential Merger Agreement, OhmConnect will merge with a new entity that is a direct, wholly owned subsidiary of Renew Home, with OhmConnect continuing as the surviving entity. Following the transaction, OhmConnect will be a direct, wholly owned subsidiary of Renew Home. As part of this Proposed transaction, Google will gain the right to nominate one board member of Renew Home (as of closing, Renew Home will have eight total board members). Minority equity holders in Renew Home will, collectively, have the right to appoint a single board member of Renew Home, but may only do so by decision of a majority of such minority equity holders. The minority equity holders will not individually hold 10% or greater interest in Renew Home. Accordingly, following closing of the OhmConnect Merger part of the Proposed Transaction, Applicants will be indirect subsidiaries of Alphabet, OTPPB, and SIP ManagementCo. In addition, following the OhmConnect Merger, individuals Matt Duesterberg, Cadir Lee, and Curtis Hapgood may also own 10% or greater indirect interests in the Applicants through Renew Home," the Applicants said

In the second part of the Proposed Transaction (the 'Renew Home VPP Transfer'), upon or following closing of the OhmConnect Merger, OhmConnect and Resi Station "may" transfer all or a portion of OhmConnect’s and Resi Station’s business, including certain FERC-jurisdictional books and records, to Renew Home VPP, a wholly owned direct subsidiary of Renew Home, which is being established to operate a virtual power plant.

More specifically, "Upon or following closing of the first part of the Proposed Transaction, OhmConnect and Resi Station expect to transfer certain aspects of their business, in whole or in part, including certain FERC-jurisdictional books and records, to Renew Home VPP. No upstream ownership interest in Renew Home VPP, OhmConnect or Resi Station will change as a result of the consummation of the Renew Home VPP Transfer," the Applicants said

In the third part of the Proposed Transaction (the 'StepStone Acquisition'), OTPPB will transfer to StepStone a portion of its indirect interest in Renew Home, rendering StepStone an upstream owner of 10% or greater interests in the Applicants.

More specifically, "in the event that StepStone commits to provide a certain level of additional capital to SIP, LLC, OTPPB will transfer to StepStone a portion of OTPPB’s director voting units in SIP, LLC and StepStone will gain the ability to appoint a member to the SIP, LLC board. As a result, following the closing of the StepStone Acquisition portion of the Proposed Transaction, StepStone will become an upstream owner of 10% or greater interests in the Applicants. OTPPB will remain an upstream owner of 10% or greater interests in the Applicants following the closing of the StepStone Acquisition," the Applicants said

An organizational structure following all three transactions is below. Click here for a larger version of the post-transaction organizational structure

ADVERTISEMENT
NEW Jobs on RetailEnergyJobs.com:
• NEW! -- Customer Care Specialist I & II- remote/hybrid -- Retail Supplier
• NEW! -- Pricing Analyst - Retail Power
• NEW! -- Electricity Pricing Analyst -- Retail Supplier
• Business Development Manager -- Retail Supplier
• Call Center Manager -- Retail Supplier

Email This Story

HOME