Clearlake Capital Acquires Electric Grid Services Firm Qualus

Clearlake Capital has entered into an agreement to acquire Qualus Corporation, a significant player in advisory and engineering services for electric power infrastructure. This strategic move positions Clearlake to capitalize on the escalating demand for grid modernization and expansion, driven by electrification trends and substantial infrastructure investment initiatives across the United States.

Qualus, headquartered in Lake Mary, Florida, offers a comprehensive suite of services essential for the planning, upkeep, and enhancement of electrical grids. Their expertise spans system design, hands-on technical support, and sophisticated software solutions that bolster grid operations. These capabilities are crucial for integrating renewable energy sources, managing power disruptions effectively, and facilitating data exchange across complex energy networks. The company serves a diverse clientele, including major utility providers, data center operators, renewable energy developers, and industrial enterprises.

The acquisition by Clearlake Capital comes at a pivotal moment for the energy sector. The increasing reliance on electricity, coupled with the transition to cleaner energy sources, is placing unprecedented strain on existing grid infrastructure. Industry analysts project a significant capital expenditure cycle in grid upgrades over the next decade, estimated to be in the hundreds of billions of dollars, to meet future demand and enhance resilience. Qualus's specialized knowledge in navigating these challenges makes it a compelling asset in this evolving market.

Under the ownership of New Mountain Capital since March 2021, Qualus underwent a period of substantial expansion, marked by the integration of numerous complementary businesses. These acquisitions include entities such as Patterson Power Engineers, Phoenix Engineering Services, Tri Sage Consulting, Ferreira Power Group, GridBright, Enkompass Power and Energy, ASSET Engineering, Linda Rogers & Associates, Planet Forward Energy Solutions, ADM Associates, dk Engineering, the North American transmission and distribution engineering business of John Wood Group, and Aquawolf, a subsidiary of Mammoth Energy. This strategic consolidation has solidified Qualus's market presence and broadened its service offerings.

Naveen Shahani, a principal at Clearlake Capital, highlighted the strategic rationale, stating, “We observe Qualus situated at the nexus of an industry grappling with a growing disparity between grid demand and technical capacity. With Clearlake’s operational expertise and capital, Qualus will be further empowered to support the nation’s largest utility and commercial clients.” José E. Feliciano, co-founder and managing partner, and Arta Tabaee, partner and managing director at Clearlake, added, “We are enthusiastic about partnering with Greg Herasymuik and the Qualus team to address the critical need for modernizing the nation’s power infrastructure. The power sector is entering a sustained era of essential investment, and we anticipate demand will continue to accelerate.”

New Mountain Capital, represented by managing directors Joe Walker and Lars Johansson, expressed pride in their stewardship of Qualus during its transformative growth phase. They conveyed confidence in the company's continued success under its new ownership. Clearlake Capital, known for its investments in industrials, energy, software, and technology-enabled services, manages substantial capital, including its seventh private equity fund which closed with $14.1 billion in commitments. New Mountain Capital, a diversified investment firm managing over $50 billion, has a history of supporting platform build-outs in its portfolio companies.