Divcon Controls Announces Investment from Goldman Sachs Alternatives

Rhea-AI Summary

Divcon Controls secures new investment from Goldman Sachs Alternatives to expand market share in mission-critical data centers and develop new product offerings. The investment aims to enhance reliability, uptime, and energy efficiency in data center facilities. Goldman Sachs will leverage its network to accelerate Divcon's growth and market penetration.

Insights

Market Research Analyst

From a market research perspective, the investment by Goldman Sachs Alternatives into Divcon Controls signifies a strategic move to capitalize on the burgeoning demand for mission-critical data center solutions. The data center market is experiencing substantial growth, driven by the proliferation of cloud computing, big data and the integration of AI technologies. This investment is likely to enhance Divcon's competitive edge by enabling the expansion of its market share and the development of new product offerings.

Additionally, the focus on energy optimization within data centers aligns with the increasing regulatory and societal pressures for sustainable operations. By improving energy efficiency, Divcon can help clients reduce operational costs and adhere to sustainability standards, which can be a strong selling point in today's market. The partnership with a renowned firm like Goldman Sachs could also provide Divcon with enhanced credibility and attract potential customers looking for proven and reliable facility management solutions.

Financial Analyst

Examining the financial implications, the recapitalization of Divcon Controls through Goldman Sachs' investment is likely to have a positive impact on the company's financial health. Access to Goldman's resources can lead to accelerated growth and potentially higher revenues. The investment could also facilitate strategic acquisitions or the development of innovative products, thus diversifying Divcon's revenue streams.

For investors, the involvement of Goldman Sachs might signal confidence in Divcon's market potential and management capabilities, possibly influencing the company's valuation positively. However, the exact terms of the investment, such as the stake acquired or the valuation at which the investment was made, are crucial for assessing the potential dilution of existing shareholders and the expected return on investment.

Sustainability Expert

The emphasis on sustainability within this investment is noteworthy. As data centers are significant energy consumers, Divcon's expertise in integrating controls systems that optimize energy usage is vital for the industry's sustainable evolution. The ability to reduce the energy load can have far-reaching implications, not only for cost savings but also for environmental impact. This move by Goldman Sachs may indicate a broader trend of investments prioritizing sustainability in infrastructure, which is essential for meeting global energy efficiency goals.

Moreover, the partnership could set a precedent for other companies in the sector, pushing them towards more sustainable practices. This could lead to a ripple effect, where improved energy efficiency becomes a standard across the industry, benefiting all stakeholders from a sustainability standpoint.

DALLAS--(BUSINESS WIRE)-- Divcon Controls (“Divcon”), a systems integrator delivering facility management automation and monitoring solutions primarily to the mission-critical data center market, today announced a new investment from the Sustainable Investing at Goldman Sachs Alternatives. The investment will recapitalize the company and position Divcon to expand market share in mission-critical data centers as well as invest in new product offerings.

In providing a seamlessly integrated controls system, Divcon has increased the reliability and uptime of the mission-critical facilities that it serves. The integration of system controls and building automation systems also optimizes the energy used to cool data center facilities by increasing equipment efficiency.

With this investment, Goldman Sachs will look to bring its network and global resources to help accelerate Divcon’s growth within the mission-critical market sector. The investment will support Divcon in exploring new markets and broadening its offerings, while continuing to improve service to the Company’s world-class customer base.

“We are excited to partner with Divcon’s management team to accelerate the company’s growth. Divcon is valued by its customers for its flexibility, depth of technical expertise and customer-centric approach,” said Jeff Possick, managing director in Sustainable Investing at Goldman Sachs Alternatives. “We are attracted by the secular tailwinds in data center construction – which have only accelerated with the adoption of AI – combined with increasing focus on reducing the energy load that data centers require to operate.”

John Palacios, Co-Founder and Chairman at Divcon Controls, said, "Welcoming an investor like Goldman Sachs is game changing for us. Their extensive network and global reach should significantly enhance our capabilities and allow us to expand our services to a wider market."

“As a management team we believe that the resources of Goldman will not only assist us in better servicing our existing customers but will allow Divcon to reach new levels within the mission-critical market,” said Ben Crowell, Co-Founder and CEO at Divcon Controls. “The global footprint, technical resources, and financial backing that Goldman Sachs brings to our partnership will play an instrumental role in the future success and growth of Divcon.”

About Divcon Controls

Headquartered in Dallas, TX, Divcon Controls provides building management and electrical power monitoring systems to mission-critical facilities, enabling the customer to control, automate & monitor energy and power functions. With over 9 million square feet of white space under management and more than 1 gigawatt commissioned since 2017, Divcon is one of the largest independent control systems contractors globally specializing in colocation data centers and mission critical facilities. Divcon’s mission is to provide its customers with cost-effective solutions to meet their exact building automation needs. Divcon strives to accomplish this through technology, innovation, and client-focused personal service.

About Sustainable Investing at Goldman Sachs Alternatives

Goldman Sachs (NYSE: GS) is one of the leading investors in alternatives globally, with over $450 billion in assets and more than 30 years of experience. The business invests in the full spectrum of alternatives including private equity, growth equity, private credit, real estate, infrastructure, hedge funds and sustainability. Clients access these solutions through direct strategies, customized partnerships, and open-architecture programs.

The business is driven by a focus on partnership and shared success with its clients, seeking to deliver long-term investment performance drawing on its global network and deep expertise across industries and markets.

The alternative investments platform is part of Goldman Sachs Asset Management, which delivers investment and advisory services across public and private markets for the world’s leading institutions, financial advisors and individuals. Goldman Sachs has over $2.8 trillion in assets under supervision globally as of December 31, 2023.

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View source version on businesswire.com: https://www.businesswire.com/news/home/20240220906926/en/

Media Contact:

Patrick Lenihan

patrick@gravitystrat.com

201-819-9871

Source: Divcon Controls

FAQ

What is the significance of the investment from Goldman Sachs Alternatives for Divcon Controls?

The investment from Goldman Sachs Alternatives will help Divcon Controls expand market share in mission-critical data centers and invest in new product offerings, enhancing reliability, uptime, and energy efficiency in data center facilities.

How will the investment support Divcon Controls' growth?

Goldman Sachs will bring its network and global resources to accelerate Divcon's growth within the mission-critical market sector, allowing the company to explore new markets, broaden offerings, and improve service to its customer base.

What benefits does Divcon Controls expect from partnering with Goldman Sachs?

Divcon Controls expects that Goldman Sachs' extensive network, global reach, technical resources, and financial backing will enhance its capabilities, expand services to a wider market, and drive future success and growth within the mission-critical market.