Nextpower Inc. has signed a definitive agreement to acquire Prevalon Energy, a U.S.-headquartered joint venture between Mitsubishi Power Americas and EES, for total consideration of up to USD 365 million in cash and stock, not including cash to be acquired.

The deal marks the solar tracker manufacturer's formal entry into the battery energy storage system market and positions the company to serve AI data center power infrastructure.

Deal Structure and Timeline

The transaction, announced, is subject to customary closing conditions, including antitrust regulatory review, and is expected to close in the second quarter of Nextpower's fiscal year 2027.

The company noted the acquisition continues a rapid expansion strategy, coming shortly after it entered into a separate definitive agreement earlier in May to acquire key power conversion technology used to store and dispatch electricity reliably and efficiently.

Prevalon Energy has over 6 gigawatt-hours of battery energy storage systems deployed globally and holds 1.3 gigawatts of firm supply contracts supporting AI and hyperscaler data center infrastructure deployments.

The company's technology portfolio includes its Hybrid Power Stabilizer, its HD5 DC block, and a newly released HD5 AC block product, all supported by its insightOS controls, monitoring, diagnostics, and long-term service platform.

Strategic Rationale

Nextpower's founder and CEO, Dan Shugar, said customers had been asking the company to extend its platform into power conversion and battery storage to deliver fully integrated firm power solutions.

Shugar said Prevalon's battery platform is expected to open new market opportunities for Nextpower in AI data center power supply applications and that Prevalon is already engaged with large hyperscalers through a lean, seasoned team with a track record of delivering storage systems for utilities and independent power producers.

Markus Wilhelm, founder and CEO of Strata Energy, who was cited in the announcement, described Prevalon's hardware and software platform as solving challenging problems for both utility-connected and self-powered AI data centers, including inertia support, grid stabilization, contingency management, and GPU AI workload smoothing.

Strata was described as one of the early movers in the battery storage sector, having delivered over a dozen utility-scale battery storage projects since 2018.

Tom Cornell, President and CEO of Prevalon Energy, said the company would be able to leverage Nextpower's global reach and deep client relationships operating as part of the larger organization, and that customers would benefit from doing business with what he described as a reliable, investment-grade partner with decades of experience in power generation and management.

Market Opportunity

Nextpower projected that global demand for battery energy storage systems outside China could represent an opportunity of up to USD35 billion by 2030, with the U.S. market alone comprising up to USD 15 billion of that total.

The company said the acquisition is intended to expand its market opportunity for energy infrastructure to serve the utility grid, AI data centers, and industrial power systems.

Prevalon's Hybrid Power Stabilizer is specifically designed to manage rapid load changes and support grid stability, which Nextpower characterized as particularly well suited to applications where power quality, rapid response, and deployment speed are critical. Those applications include AI data centers, private grids, grid-connected storage, and industrial power systems.

Updated Financial Outlook

Nextpower raised its fiscal year 2027 financial outlook in connection with the announcement, with the updated guidance assuming the successful closing of the transaction.

The company now expects fiscal 2027 revenue of approximately USD 4.0 billion to USD 4.4 billion, up from its prior outlook of USD 3.8 billion to USD 4.1 billion. Adjusted EBITDA guidance was raised to approximately USD 845 million to USD 930 million, compared to a prior outlook of USD 825 million to USD 900 million.

On a GAAP basis, the company expects net income of USD 507 million to USD 573 million, compared to the previous range of USD 501 million to USD 559 million, and GAAP diluted earnings per share of USD 3.22 to USD 3.64, up from USD 3.19 to USD 3.56. Adjusted diluted earnings per share guidance was set at USD 4.30 to USD 4.73, compared to a prior range of USD 4.21 to USD 4.59.

Nextpower noted the updated outlook includes planned incremental costs of approximately USD 50 million related to the acceleration of its entry into the power conversion market.

The adjusted EBITDA range excludes approximately USD 208 million for stock-based compensation, net intangible amortization, and acquisition-related costs.

The adjusted diluted earnings per share range excludes approximately USD 1.09 per share for the same items, net of tax impacts. The company described the transaction as expected to be accretive to its fiscal year 2027 financial outlook.

Platform Expansion

Nextpower described the Prevalon acquisition as a continuation of its evolution toward what it characterized as a comprehensive, integrated energy technology platform spanning structural systems, electrical infrastructure, power conversion, storage, controls, automation, and software. The company is headquartered in Fremont, California, and trades on the Nasdaq exchange under the ticker symbol NXT.

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