Generac to Acquire Ecobee: Smart Thermostat Leader

Generac to Acquire Smart Home Firm Ecobee

Generac, a generator manufacturer headquartered in Wisconsin, has announced its intention to acquire Ecobee. This pairing may initially appear unexpected, but it mirrors a growing trend of established companies entering the smart home market via acquisition.

Strategic Expansion for Generac

Acquiring Ecobee represents a swift method for Generac to accelerate innovation in new technologies. The company has a long history, spanning over six decades, and this move allows for rapid development in the smart home sector.

The financial terms of the agreement involve a $200 million cash payment, alongside $450 million in stock for Ecobee shareholders. An additional $120 million in stock could be paid based on the achievement of pre-closing milestones, potentially bringing the total acquisition cost to $770 million.

Ecobee's History and Growth

Founded in 2007 and based in Toronto, Ecobee has established itself as a prominent player in the smart thermostat industry. It competes with well-known brands like Nest, which was acquired by Google in 2014.

Similar to Nest, Ecobee broadened its product line beyond thermostats to include smart home security cameras and sensors.

Synergies and Future Vision

“Generac’s transition into an energy technology solutions provider presents numerous opportunities to integrate our Ecobee products with their existing residential offerings,” stated Ecobee CEO Stuart Lombard. “This integration will enable enhanced monitoring and control of a substantial portion of a home’s energy consumption.”

Lombard further expressed enthusiasm about joining the Generac team to collectively advance a more sustainable and resilient energy future for customers and communities.

Investment and Potential Acquirers

Ecobee has secured approximately $150 million in funding, including investment from Amazon’s Alexa Fund. Amazon was previously considered a likely potential acquirer, given its portfolio of smart home brands like Ring.

However, Amazon recently unveiled a new thermostat developed in collaboration with Honeywell.