[00:00:00] Speaker A: The Telug deal, again, it's a hardware business, right? They bought Tellog in 2015 and we've seen them try to take that portfolio and gear it more towards this more software and service based strategy. So they've certainly built up some of the data management and data analytics capabilities around those devices.
[00:00:22] Speaker B: You. I am Reese Tisdall and this is you of water, in which we talk about all the ways which companies, utilities and people are addressing the challenges and opportunities in water. This is episode 86, and I know it's going to be a good one. Why is that? Well, because I'm joined today by Bluefield Research is Eric Bindler, senior research director, to discuss Badger's recent acquisition of Trimble's Telug business. And truth be told, this is an interesting one. We've been watching strategies of these two companies unfold before our eyes over the last two to three years, and quite honestly, where they stand is even clearer now. So I've asked Eric to shed some light on the recent transaction where these companies are heading. Then also, what else can we expect going forward for these companies, but also in the digital water market in relation to what they've been up to? So this is going to be a good discussion with Eric. But before we do that, as I'm now doing these days, I thought I'd share some news that caught my attention this past week. So let's get to it. So, spanish water company Aqualia has acquired a controlling stake in the company municipal district services.
So, to start, Equalia is owned by FCC, 51% by FCC, that is, and spanish engineering company and group.
And another 49% of equality is owned by Australian funds manager IFM investors. MDs, on the other hand, it's based in Katie, Texas and manages water services for more than, I'd say, 360,000 people, mainly on the outskirts or in the outskirts of Houston, Texas. MDS is also reported to have approximately 140 service agreements with municipal utility districts in Texas.
So essentially, they are an on M services provider, sort of offering a range of services to these smaller systems. So why Bluefield do we care? Well, for one, we've known that equality has been on the hunt for some form of platform in the US market. The firm has explored partnerships with other engineering firms. They've also been looking at O M service providers. So it sounds like they've now at least sort of gotten a toehold in the, you know, to my second point, Texas is one of the hottest markets, if not the hottest, when it comes to operations and maintenance and M A for water utilities.
It's a favorable market.
We've seen a lot of activity more recently and actually talked about it on this podcast from Infamark H two o innovation. But we've also seen some activity with NW natural as well, which is more of an IOU in the market. So the combination of the fragmentation of the market, a number of municipal utility districts, which is where mds is focused, as well as policy landscape, have made it really attractive.
It's also interesting. Market entry into the US, let alone any other country or market, is a challenge in and of itself. Demonstrating capabilities, financial wherewithal, and understanding the local complexities takes a lot of time and experience.
So it's really important, and not always, I guess it's important to have a foothold in the market, which is seemingly what Aqualia has been looking for, whether it's a big one or a small one. You got to start somewhere. As someone from one of the ious told me a while back when it came to M A, sometimes you just got to jump into the pool head first and figure it out. And if you do it well, more business will follow. Equality is a global company. It has diversified positions in water from engineering services, it's got utility ownership and concessions around the world. In fact, not all that long ago on this podcast, once again, I discussed their recent buyout of the french company SaRS utility positions in Colombia. So watching what equality is up to is interesting. Sentimentally, this deal, just when I think about Equalia and the spanish EPCs, but equality, or FCC in particular, it brings me back to July 2013, which is the month that actually of Bluefield's founding, when japanese trading house Mitsui acquired a 49% stake in a Czech Republic water system from Aqualia. Times have changed for FCC and the debt latent spanish engineering firms like federal acs. You know, after the recession, they took a little time for them to recover, and they seem to have done so in a number of different ways. And now today they're once again spreading their wings. So I don't want to be a hyperbolic when it comes to that, but they're definitely made great strides over the last decade, let me put it that way. So we look forward to seeing really how this plays out and what equalia continues to do. Will there be more M A? Will there be partnerships with us based firms, or how will they grow organically within the Texas market when it comes to O M? It's very regionally focused, and there's been a lot of interest in that segment, whether it be from existing players expanding their portfolios. And from our getting into ScaDA system integrators, they've been buying up companies. That's a good example. Also, a number of them are owned by private equity firms that are looking to scale their portfolios as well. Ultimately, that may be an opportunity for Equalia to add to its list of systems and clients. So look forward to that. Pretty exciting news for us here at Bluefield. And with that being said, that's my news of the day. So let's get to Eric and hear what he has to say about the Badger and Trimble deal.
All right, so joined here by Eric Benlar. Eric, happy New Year. You're actually the first recorded podcast, 2024. All right.
[00:06:37] Speaker A: It's an honor.
[00:06:38] Speaker B: Well, there you go. You can tell your family all about it.
Look, so the reason we were talking earlier, maybe even in the last week about sort of podcast ideas and it seems like we're off to somewhat of a fast start. Badger has just acquired Trimble's Telug business. And so obviously you're senior research director. But also for everybody who doesn't know, Eric is first and foremost leading our digital water service. And these two companies and their water activities really fall into that space. So let's talk a little bit about these two companies. So, Eric, what's the story behind the transaction? What are some of the details? And then we can go from there?
[00:07:23] Speaker A: Yeah, absolutely. So not a ton of details kind of disclosed as yet. So just to start with, kind of what's in the press release essentially on January 3. So again, very early in the year, we got the news that Badger had acquired essentially the Telug business from Trimble. And so that's a portfolio that Trimble's had for about seven or eight years now. I think they made that acquisition in 2015. But essentially it's remote monitoring technology.
[00:07:50] Speaker B: Right.
[00:07:51] Speaker A: So they've got kind of data logger RTU devices to collect data from sensors out in the field and transmit that data back. They do also have some sensor equipment in there as well. They have some flow meters and pressure monitors and things like that. But essentially bought that hardware, that equipment business, as well as some of the software that went along with it. Like I mentioned, not a ton yet. There certainly no financials were disclosed or anything along those lines. Although both Badger and Trimble are publicly traded companies, we'll certainly be keeping an eye out for whether anything else is kind of revealed in their next round of quarterly earnings calls and reports and that kind of thing.
[00:08:28] Speaker B: Yeah, I mean, I think it's interesting the reason we were or are excited about this one. We've worked with Tremble and Badger and continue to do so. But what's interesting is that as we look back in retrospect, it seems like their strategies have been unfolding for some time now.
The signals have been made. They've either been making announcements and there have been some deals along the way. Why don't we start with Badger? Can we talk a little bit about Badger and much its business has changed. Their strategy has sort of pivoted a little bit in a different direction.
Any insights you can provide on that would be awesome.
[00:09:09] Speaker A: Yeah. So maybe just with a bit of introduction, a little bit of background. So Badger is about a half a billion dollar business, right? So they made about 566,000,000 in revenues in 2022. About 85% of that comes from water utility sales. And so that's really mainly they're a metering company, as the name suggests.
[00:09:30] Speaker B: Right.
[00:09:30] Speaker A: Badger meter. They are a metering company. So that's water meters. It's kind of AMI infrastructure and endpoints and radios and things like that. The other 15% or so of their business is flow instrumentation. So they make flow meters primarily for industrial applications. And so that's definitely part of their business as well. I think a lot of what we talk about, a lot of what they've been focusing on is investing in that utility market. But can't forget about the flow instrumentation piece of it as well. In terms of kind of where they've been going and what their strategy has been. They've been really interesting to watch, frankly, over the past couple of years, when we go through our digital m a data, they have been acquisitive. They've kind of been moving in a couple of different directions over the past maybe decade or so, decade and a half. And a lot of what they've done, a lot of their really interesting strategic shifts have been driven by, or at least underpinned by m and a activity.
[00:10:29] Speaker B: Right.
[00:10:29] Speaker A: And so the first kind of wave or one key set of this was back as early as 2013.
They bought a company called Aquaq, another company called Dflow in 2017. And this was really kind of a signal that they were transforming their metering portfolio, right? So they really went from a focus on mechanical meters and other types of communications technology, really moving towards cellular AMI. They've really been kind of a major player in cellular based AMI networks as opposed to kind of more proprietary AMI technologies that somebody like at census or an itron would offer. So they were really one of the leaders or the pioneers in that field also moving very early on into static meters. Right. Again, we've had conversations on the pod about kind of the metering landscape, but static meters being kind of a newer generation of metering technology. They don't have any moving parts and so they're typically more accurate.
They don't need as much maintenance. They don't wear down over time the way that a mechanical meter does. So another big kind of metering product innovation. And then they've been building out certainly their kind of metering software and analytics capabilities over that time as well. So that was the first thrust.
[00:11:47] Speaker B: Right.
[00:11:47] Speaker A: Really as a metering company, marking maybe a bit of a new strategy within the metering space, but still very much within that space. They also made a bunch of acquisitions in the mid 2010s, buying up primarily distributors. Right. So a handful of kind of regional distribution partners across the US, national meter and Automation, United Utilities Inc. Carolina meter and supply, and then innovative metering solutions and again, really firmly within that meter market, just getting some more channels to market, getting some more sales capabilities and things like that to continue to push their metering products. It was really around 2020 that we started to see this very distinct shift towards expanding their portfolio out of the metering space and into other aspects of the digital water market. And so really what kind of see them moving upstream into the distribution network? They're moving into different types of network monitoring and IoT hardware as well as kind of software accompanying that. So they bought scan in 2020 and ATI in 2021. These are both water quality monitoring companies. They bought Cerinix in 2023, which is a pressure monitoring company. And then now the kind of the Telug portfolio. So like I said, the data logger, the RTU, some of those other sensor capabilities, all of these are, they're all hardware companies. I think this is a really important point that we'll come back to. And it was actually called out in the press release of this Telug and Badger deal. They're basically hardware enabled software. Right? So they're hardware companies that have these interesting kind of software, data analytics capabilities, but moving from that core space at the customer at the point of consumption up into the distribution network to kind of provide more data, more insights into network conditions and operations and that kind of thing.
[00:13:38] Speaker B: Yeah, it's that sort of horizontal shift that I think has really gotten us excited. I mean, I don't want to take anything away from buying distributors and such that makes sense just from a sales strategy, channels to market or expanding the channels. But this is really interesting. Part of it is the software piece of the equation or the data analytics, better way to put it. That's interesting. That kind of does piggyback on what they do, but also into the network, like you said. So Badger meter has gone in that direction. Then on the other side of the equation is trimble. And Trimble, obviously, in selling off Telag, that in and of itself kind of gives an indication of what's happening. But there's been more happening in the past, at least historically. What's the story with Trimble? And what is this signal about what they're up to?
[00:14:33] Speaker A: Yeah, so again, just to start with a bit of background, so Trimble is about a $3.7 billion company in terms of their 2022 revenues, much more diversified. So they serve a wide range of end markets. They have a significant buildings and infrastructure segment where they do all kinds of kind of engineering, design, construction, bim type software. They do a lot in the agriculture space. They do a lot in terms of fleet management and telematics for vehicles. And then I think their roots in a lot of ways were in kind of the geospatial business. So they do like surveying equipment and mapping equipment and positioning equipment and that kind of thing. So definitely also kind of a hardware and equipment background. But really, as we look at a lot of their financial results, their kind of communications to the market, their investor presentations and things like that, they have very much been moving in the direction of software.
[00:15:28] Speaker B: Right.
[00:15:29] Speaker A: Like moving away from hardware. They've got a bunch of exhibits in their latest investor day presentation showing how they've kind of moved towards. They're now at about a 55% to 45% split between software services versus hardware.
Their software and services revenues have grown at about a 20% compound annual growth rate over the past ten years, versus only 8% for hardware. So really very much, very intentionally moving away from hardware and moving towards different types of, especially like cloud based and software as a service based platforms and kind of ecosystems for the different types of end markets that they cover. Right? So construction, transportation, agriculture, really trying to provide that kind of common software platform, common data environment for different types of markets. So that's been the broader strategy in terms of where they sit within water or what their position has been in water. The Telog deal, again, it's a hardware business, right? They bought Tellog in 2015, and we've seen them try to take that portfolio and gear it more towards this more software and service based strategy. So they've certainly built up some of the data management and data analytics capabilities around those devices. They actually launched a remote monitoring as a service offering in 2020 where they were taking essentially the Telog devices. It was kind of a subscription based bundle that would include the RTus or the data loggers, the sensors, equipment services, the software. And they were basically selling that instead of a kind of capital investment utilities buying that equipment, they were kind of offering it similar to a software as a service or a data as a service, that type of a model.
So they've tried to move in that direction, but it's still fundamentally a hardware business, right? It's devices, it's monitoring devices, it's kind of communications devices. And that market is becoming increasingly crowded, increasingly competitive. It's becoming harder to differentiate. There's a lot of different sensor vendors out there serving water and adjacent markets. There's a lot of different platforms where you can use that data, visualize that data, you can pull it into your GIS, you can pull it into your hydraulic model, you can pull it into your ScaDA system. And so it's a lot harder to really carve out kind of a niche or a way to differentiate those capabilities. And I think that's maybe part of the logic or the rationale here. Meanwhile, in terms of the other thread or the other direction that Trimble has been going, the other kind of businesses that they've bought over the years related to water, they bought a company called Spatian Technologies in 2006 that was kind of mobile workforce management software for utilities. Let systems in 2010 was event and incident management software for utilities ebuilder in 2018, which is kind of construction and capital projects management, not specifically for water, but they do have some water customers. They've worked with WSSC in Maryland. But really, the big one, I think a deal that we covered quite a bit when it happened and have been paying close attention to was Citiworks.
[00:18:34] Speaker B: Right.
[00:18:34] Speaker A: They bought. The company is called Azteca Systems. Kind of. The product name is cityworks. Essentially an asset management, or CMMs kind of work order management platform that very popular in the US water industry.
It's also used for public works departments, for parks and things like that. But essentially, it's an asset management platform. It's a place where utilities can keep track of the work and the maintenance history of their assets. It's heavily tied into GIS. So kind of keeping track of where those assets are, but also what needs to be done, what valves need to be turned, which hydrants need to be inspected, where do pipes need to be fixed, and kind of that history of really just the lifecycle of utilities buried assets and so that's really kind of stepping back to think about this deal. It makes a lot of sense. Right. Trimble has always had a pretty significant presence in kind of the engineering, the design, the kind of construction management software side of things. And Cityworks gives them this asset management kind of moving from, if you're thinking about the lifecycle of an asset, they had the early stages covered. Right. The construction, the design, or I should say the design, the engineering, the construction. Cityworks really gives them a significant set of tools for the actual operations and maintenance of those assets after they've already been built. Right. And so moving away from kind of the monitoring side of it and the hardware side of it and moving towards that software suite for really kind of managing assets through their entire lifecycle for a range of industries, including water, but again, also electric utilities, local governments, public works departments and things like.
[00:20:23] Speaker B: And so, and then at the same mean as you kind of seemingly makes sense for badger as well. Right? They are fundamentally a hardware company, their metering business, in flow control business. I mean, that's what they do. And so adding this, what they're doing is sort of expanding their scope, like you said, into the network from just sort of the metering for the municipal side of the equation. So we're not surprised by this in many respects. Like, oh, well, that makes we've kind of, like you said, you mentioned Cityworks. We saw Trimble heading in that direction through the cityworks deal. This, if anything, sort of just solidifies maybe what we've been seeing or thinking for some time. But I guess the question is, I mean, you mentioned this about competition and what's happening in the market, why Trimble would be doing this. So you alluded to this, but the $64 million question is what is the signal for the market? I guess, really who or which companies should be taking notice of this, whether it be on the trimble side or on the badger side of the deal.
[00:21:29] Speaker A: Yeah, I guess certainly for both sets of kind of direct competitors. Right. So for badger on the metering front, they're certainly not the only metering company that has kind of made similar moves, like I said, upstream into the distribution or collection.
Actually, you know, we put out a report last year on the global metering landscape, did some kind of deep dives into competitive trends. And that was one of the big ones that we've been looking at in terms of where major global water metering players are kind of investing in positioning and strategic moves that they're making. But just to name a couple of other examples, Camstrip has embedded some acoustic leak detection sensors in their meters. So kind of adding that capability in terms of network management.
Census has some embedded pressure and temperature capabilities within their meters. Mueller, of course, has made some past acquisitions in related areas like ecologics for leak detection or I 20 for pressure monitoring. So badger is certainly not alone in this regard, although arguably they're one of the more maybe aggressive in terms of making acquisitions to build out the suite of products and certainly now having not just sensors but also that kind of core data logger and RTU portfolio. Right. These are basically sensor agnostic devices that can connect and transmit data from a range of sensors and a range of third party companies. So really opens up what they're able to do, the types of data that they're able to kind of collect and process and manage and integrate all of that to give utilities a better idea of just what's happening in their networks. Right. Kind of looking at the hydraulics, the pressure, the quality, the flow, getting all of that together really gives a much better idea of what's actually happening in those underground pipe networks.
[00:23:12] Speaker B: Right.
[00:23:12] Speaker A: That's kind of the point of all of this. So certainly badger's core competitors, I think, will be taking note. But I think, mean, badger is a really interesting example, kind of a poster child for an incumbent water infrastructure or equipment supplier that's been successful in moving into the digital water space and kind of becoming more of a digital water market leader. They're more than a 100 year old company, right? They were founded in 1905. And so certainly they've been around for some time in the water space, but they have kind of the valuations of a tech firm. Right. They've seen about 550% growth in their stock price over the last decade, about 80% of that even just in the last year. So they're really kind of become these stock market darlings within the sense of the water market and the digital water market.
Certainly we've talked to other players, other kind of incumbent pipe companies or pump companies or valve companies that see them as almost an inspiration or maybe even kind of someone to be jealous of in terms of how they've been able to make this shift and start to be kind of perceived by the market as much more of kind of a digital player and analytics player instead of just a kind of a water equipment supplier.
[00:24:29] Speaker B: Right.
[00:24:29] Speaker A: And so that's really interesting. I'm sure that many in the market will continue to watch them from that perspective as well. From the trimble side of the equation. I think this just maybe clarifies their position in the asset management market. They're really doubling down in this space. Right. And again, those were kind of the two key threads of their water business. And by getting rid of one of them, it obviously gives a signal that the kind of asset management, well, really the asset lifecycle management, like I said, from design and engineering and architecture and permitting and all of that through to construction management and program management, up until asset kind of operations and maintenance. Having that full suite of solutions puts them into competition with quite a number of players that are also big names in the market, both in the water sector, but also in other industries. So that could be your bentleys, your autodesks, your Esris. There's a number of other really big asset management and kind of enterprise asset management companies that are active in water in one way or another. So that's infor, IBM, Oracle, SAP, these obviously big names, big tech companies that even people outside of water are very well aware of. So definitely expect triple to continue to kind of butt heads with these players and then even some of the smaller kind of asset management, CMMS types of companies that would traditionally compete with Cityworks specifically, they've got some pretty big backers, right? So cartograph is another big player that competes a lot with Citiworks. They were acquired by Opengov, which has backing from Cox Enterprises. Right. So big name there.
A company called Brightly, which was formerly known as Dude Solutions, was bought last year by Siemens. Rockwell has something called Fix, which is kind of a CMMS provider. So there's actually quite a number of big names, really interesting tech players that are active in this space in one way or another. Again, not necessarily all as deeply embedded in the water industry and kind of serving a wide range of industries in terms of asset management and construction management and all that. But definitely a really interesting market with a lot of names, a lot of big names, a lot of capital to kind of throw around to try to build up a position and continue to grow. So with all of, especially as we talk about in the US and other markets, infrastructure funding, there's a lot of construction happening, right. A lot of infrastructure being built out, a lot of new assets to be built and managed and maintained. And so definitely some significant opportunity in kind of adding that digital capability and analytics capabilities to that work.
[00:27:11] Speaker B: Yeah, and I mean, to emphasize, I think you definitely touched upon this like Badger is really more closer to being a pure play water player, whereas Trimble is more diversified. But yeah, I think that there are definite tailwinds, right. Even for metering. I mean, that's a big part of actually the capital spend in the digital water space as a whole. So, I mean, if anything, badgers starting from seemingly a strong base. And so this is just additive, these solutions to what they're doing and tremble is just sort of, they've obviously found their area of focus, at least as far as solutions go, but yet across multiple industries and just more diversified. No, I think this is super interesting. Really like this.
It's not often that we get good m a transactions that kind of show sort of horizontal shifts across the value chain or in other product areas. And so really like this one, I admittedly look forward to hearing or reading what the financials turn out to be. I think that'll hopefully come in time, if not through the financial reports, maybe even anecdotally. So I look forward to hearing that and also just finding out what the market's reaction is to it. But it's also early in the year, so we are in the first week, week and a half of the new year, 2024.
So this is somewhat of a big deal. So have there been any other deals? I think in a couple of meetings we've had over the past week you've mentioned a couple.
What other deals have you seen that are worth mentioning while I've got your ear?
[00:28:59] Speaker A: Yeah, I mean, it's been actually a pretty interesting first. Call it. So today is the 11th. So call it a week and a half of 2024. And especially just given if you've listened to anything on, if you've listened to our podcast or if you're a client, you've seen our research. Right. I mean, water sector M A was not very strong last year, especially in the digital water market. The vc space was a bit mixed as know for anybody that wasn't a cybersecurity company.
It's been really tough to get funding in the digital water space. And so to see not just this deal, but also another kind of interesting m a deal, basically this was announced in the past few days as well. AbB acquired Realtech, Realtech being water quality monitoring company, kind of competitive with scan as well as Hawk, for example, serving a range of municipal and industrial applications bought by ABB. Right. They're a big name in the Scada world. They do kind of variable speed drives and motors and things like that for water, wastewater pumps. Another, I mean, again, a big diversified industrial player that would compete with the likes of Schneider, Rockwell, Siemens, some of these other names that we've already mentioned. But ABb's not been as engaged in kind of the digital water market as some of those other peers. Right. And so this is kind of interesting to see them buy like a pure play water monitoring company. It's a bit unique, it's a bit new as far as their positioning and their strategy goes. So I mean, Realtech is not, certainly not a big company, but it'll be interesting to see does this mark potentially more of kind of an intentional, dedicated strategic focus on water and on expanding water capabilities for ABB. So we'll certainly be watching that one moving forward. The other one that was interesting and great to see was 120 water received a $43 million growth equity investment from Edison Partners.
I think it was the beginning of this week, if not end of last week.
This puts them at about $60 million in total funding, which is really right up there among the top of digital water companies in terms of VC and early stage funding that we've tracked. Again, if you're talking about cybersecurity companies that serve water in a range of other industries, those companies are making, they're pulling in a lot of capital right now. But as far as kind of the water pure play or digital water pure play companies that we track and startups that we track, I'd say 120 water is now at the upper echelons of kind of funding received to date. So it's not surprising. I mean, they really have carved out a strong niche in the lead service line management space. Utilities are facing, utilities across the US at least, are facing a deadline of October of this year to kind of inventory and submit data on their service line materials.
[00:31:43] Speaker B: Right.
[00:31:43] Speaker A: Lead and others, and really kind of set their plans for how they're going to replace and remediate that throughout their communities. And there's really a big emphasis on digital there.
[00:31:52] Speaker B: Right.
[00:31:52] Speaker A: And so 120 water provides kind of an easy platform for collecting that data, for kind of submitting those records for compliance. They've also done a really good job of tapping kind of the low end of the scale. Again, this is something we talk about quite a bit, the vast kind of untapped potential for digital water solutions in the very small to small to mid sized utility category in the US. Rural utilities that really have very little financial and technical capacity to adopt data and digital tools and things like that. 120 water has really made it a point to go after that market and to partner with state rural water associations and state finance departments and environmental departments and kind of bundle together these deals and these kind of portfolios of clients just with basic tools to basically do that, to manage their lead service line kind of program compliance and their records. So again, not surprising to see them succeeding in this environment when many others are having trouble raising capital. But yeah, just really, I'd say quite a bang to start the year and hopefully it's a sign of things to come. I mean, we've been talking about with interest rates potentially starting to moderate, or at least with investors getting maybe comfortable with where things stand from a financial perspective, hopefully starting to see m a deal flow tick back up and VC activities start to tick back up again. And this is certainly a good positive sign to kind of kick the year off with.
[00:33:22] Speaker B: Yeah, the 120 deal is really exciting. I mean, talk about tailwinds.
And I think maybe a couple of years ago even we looked at them like, what's going to happen with lead?
Is the momentum in the market fading?
Pandemic came along and it got a little quiet. We talked about infrastructure week every week for the better part of four years.
Nothing seemed to happen. Then the infrastructure Investment Jobs act came along and a big chunk of funding going to lead service line replacement really sparked that market. It was like really huge. But they're in the sweet spot, right? All these systems or networks or markets need to be inventoried and that's really what they do. So they certainly have got their hands full as far as work, one would think. So. Agree with you 100% on that. Well, man, this is a lot to unpack. Eric, super interesting, as I oftentimes do, before I let you go, what's on your agenda?
[00:34:34] Speaker A: Yeah, so the team has been busy. Not everyone took as much time as I did over the holiday, so kind of came back with a couple of reports to try to review and get out the door. So we've got a food and beverage report for water wastewater management in the food and beverage kind of industrial vertical. So that's a really exciting one. That's going to kind of cap off the series that we were working on last year, looking at a handful of key industrial verticals, semiconductors, pulp and paper, chemical manufacturing. So food and Bev is going to be kind of the 8th and final installment there. Looking forward to getting that one out the door. Another colleague has been working on kind of competitive analysis of eight key japanese trading companies that have made a number of investments in diesel plants and treatment plants and utility solutions and that kind of thing. So looking at that, more of a competitive analysis and strategic analysis of those players, and then I think the next one is going to be digital water private equities. Right. So we're talking quite a bit as we have, about investment trends and acquisition trends in the digital water space. We've been doing kind of a deep dive into about 25 to 30 leading private equity players and the positions they've built out within digital. So a lot of really interesting stuff, kind of jumping from topic to topic every couple of minutes or every couple of hours as I go through my day. But yeah, really looking forward to getting all that research out and jumping into kind of. I guess the last piece I'll mention is just updating our forecast is going to be a big priority for the next couple of months, is going through our industrial water service, our municipal water service, our digital water service, and kind of figuring out what all of these changes mean as far as top line spending and investment. So much more to come on that as.
[00:36:15] Speaker B: No, I agree. And to your point about m a like private equity, you mentioned that, but we've been talking about m and a for the better part of the half hour. So also we're excited to see how 2024 unfolds when it comes to investment investments and m and a as a whole. Like, cost of capital has been really expensive over the past year, there's been a lot of uncertainty. The tech sector has been getting banged up a little bit, whether that's impacting sort of digital players or not.
In 2023, it was like kind of a weird year when it comes to geopolitical, financial, or economic uncertainty, our expectations were that going into 2024, things would pick up. Inflation has already been declining in many respects. Interest rates, they seem to be flattening out. If not, we'll ultimately come down soon enough. That's our hope. And then maybe that'll unlock more deal flow. So the one thing which I was going to segue into anyway, in my outro, as I would say, and that is you're also going to be in Portland, Oregon, in about a month for UMC. Right. You're speaking at, you're on a panel with, I believe.
[00:37:41] Speaker A: Yep. Yeah. So we did a white paper with Xylem about maybe beginning to middle of last year called the ripple effect, which was looking at kind of the digital transformation strategies of a number of major utilities, some in the US, but also global, really trying to kind of suss out some practical tips.
[00:37:59] Speaker B: Right.
[00:38:00] Speaker A: How do you actually tackle these challenges of getting your staff on board with digital transformation or getting your customers, your board, your kind of elected officials on board with digital transformation? How do you kind of come up with a plan and figure out those investments, not kind of reinvent the wheel or try to take on everything at once, but go piece by piece. And so it's been really interesting exercise. Really good paper. Definitely recommend checking that one out. And I'll be speaking with a colleague from Xylem on kind of some of the key findings and takeaways there.
[00:38:32] Speaker B: Yeah, I think you can actually find that the ripple effect, I think at least a link to, or maybe even versions on our website. So if you go to our white paper page, where we've got a number of different white papers which are all complimentary, courtesy of the companies and clients we worked with on. So, but if you want to hear Eric speak about it, go to UMC in Portland next month. He'll be there.
[00:38:54] Speaker A: Absolutely. Yeah.
[00:38:55] Speaker B: So, Eric, once again, happy new year. Thanks for jumping on. You're going to also be in Boston next week. You're in Chicago. Typically, for those not in the know, he'll be in Boston next week to catch up on some strategic planning and other fun.
Maybe I'll see you tomorrow and we'll talk, but I'll see you next week. How about that? We'll leave it at that.
[00:39:19] Speaker A: Yeah. Assuming no major snowstorms and assuming that my plane doesn't fall apart like they tend to be doing lately, then I will see you next week.
[00:39:26] Speaker B: Oh, man, that's terrible. Okay.
[00:39:28] Speaker A: Yeah.
[00:39:29] Speaker B: All right, well, safe travels then.
We'll talk soon. Thanks again. Take care.
[00:39:34] Speaker A: Thanks, Reese.
[00:39:36] Speaker B: All right. That was fantastic having Eric join. Definitely a font of knowledge, particularly when it comes to digital water and companies and what's happening, but on all fronts, water.
So thanks again to him. And as he mentioned, he's going to be in Portland in a couple of weeks. But we are as the company wide, we're going to be at a number of different events. We're going to be at the corporate water industry update, which is in Austin, Texas, 20 February. I will be there. We will also be at World Water Tech Innovation summit in London on the 20th and 21 February. I will be at the PVC Pipe Association. Unibell will be at their executive annual meeting. That will be in Costa Rica in February. So that's good time of year to be there. Excited given that I'm coming from Boston. And then lastly a little further out and we are setting meetings up all around these events. We will be in Denver, Colorado from the 11th, 14 March, if not longer, but we will be at the water reuse symposium. So if you're going to be there, keep an eye out for us. Look forward to seeing you then. It's the beginning of the year. So before we sign off, if you're in Boston or in Barcelona, let us know. We'd enjoy the opportunity for a meeting. We do it all the time. We do it increasingly. So come have a coffee with us. Or we can just go out to lunch. Or if you come later in the day, maybe we'll go get a drink after everybody's dry. January please subscribe to Future Water podcast and give us a review.
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