Real estate software and data analytics firm RealPage announced its acquisition of American Utility Management (AUM) today in a move that expands the company’s resident utility management (RUM) platform providing billing, invoice processing, and bill payment services to more than 2.5 million rental units.
AUM, a provider of utility and energy management solutions for the multifamily housing industry, offers an energy management platform that allows property owners and managers to gain better insights into energy consumption and costs relative to their peers. The program is designed to help maximize cost recovery, reduce energy usage and expense, and provide rental-real estate operators a tool to manage their utilities more effectively.
Steve Winn, chairman and CEO of RealPage, says he’s excited to join forces with the AUM team. “We believe this acquisition will provide more scale to our resident billing operations, lowering our costs to deliver the platform so we can focus on improving innovation and product quality for our clients,” he said in a statement. “In addition, AUM has developed an energy management platform that enables operators to benchmark energy consumption and cost against their peers.
“By combining data captured by RealPage with the data available from AUM, we expect to create the largest and most accurate database of utility consumption and cost data in the industry,” he added. “Generating actionable insights from that data is what RealPage does best. This is another example of how our data analytics capabilities and depth of real-time data can help owners optimize yields on their real estate assets. We will also be adding approximately 200,000 new rental units.”
The purchase price of approximately $70 million is subject to certain working-capital adjustments and post-acquisition indemnification claims. AUM possessed revenue of approximately $30 million for the year ending Dec. 31, 2016. RealPage expects the acquisition to contribute approximately $15 million in revenue and an adjusted EBITDA range of $2 million to $3 million during 2017. Integration work is expected to be completed by the end of 2018, at which time the company expects the purchase-price valuation to represent approximately seven times adjusted EBITDA.
The AUM team will report to Jason Lindwall, senior vice president, property management solutions, for RealPage, who leads the company’s Spend Management and Resident Utility Management solutions.
“As part of RealPage, we'll expand the scope of solutions that we can offer to our clients, including vastly expanded meter installation and maintenance capabilities," said Michael Miller, president and CEO of AUM, in a statement. “RealPage will continue to support the billing engine and customized billing methods used by our clients. AUM personnel have been hired by RealPage so that there will be no disruption in service, and RealPage intends to expand processing volume through our Chicago service center.”
The AUM deal comes on the heels of RealPage’s recent acquisitions of Lease Rent Options, in February, and Axiometrics, in January.
