A Look Back at the SAS Acquisition of RiskAdvisory
By Kathy Walsh, Marketing Strategist, Energy Risk, SAS Canada
It’s hard to believe it’s been 3 years since the acquisition of RiskAdvisory by SAS. Back in 2003, Dr. Goodnight (SAS president and CEO) said: “This [acquisition] complements and strengthens SAS’ world-class risk management software and solidifies our leadership in the risk management area of the rapidly evolving energy and power markets.”
How successful has the acquisition been to the two companies? We think it’s been very successful, not just for SAS and RiskAdvisory, but for our new and existing clients. Following are just a few highlights of the evolution of the SAS and RiskAdvisory relationship since November 2003.
Our perception of the future risk management marketplace was right! “Back in 2003, our experts felt that energy, utility and financial service organizations would be investing a significant amount of capital on risk management and the evidence is certainly there to support that vision” says John Lawson , director of the firm’s Energy Risk practice. “This evidence includes our growing list of energy clients (including Constellation, Canadian Derivatives Clearing Corporation, Provident Energy Trust, CPFL Energia, Dominion, EnCana, EPCOR, Entergy, Niska Gas Storage, BP America, Citigroup, Portland General Electric, SaskEnergy, Suncor, NB Power, UBS, AG Energy, and Western Oilsands) and the findings of research and surveys conducted by industry experts like Utilipoint.”
The acquisition broadened our product offerings for our clients and the marketplace! Together with the products and expertise RiskAdvisory brought to the table, SAS ® Risk Solutions for Energy offers a complete front-, middle- and back-office risk management and trading platform. SAS technology provides oil and gas companies, energy hedge funds, financial institutions, energy marketers and utilities with industry-leading physical and financial commodity deal and asset capture, position and risk reporting, and the most sophisticated suite of risk analytics available on the market. As well, the power of SAS ® gives our clients a full range of advanced modeling techniques to accurately measure and monitor risk factors associated with trading energy. SAS’ fully configurable risk solutions enable the accurate modeling and assessment of both market and credit risk in an open framework that can also leverage our clients' proprietary risk methodologies . Our expanded solutions include modules to manage contracts, collateral and netting, generate and track confirmation letters, load and store curves, document and account for hedge programs, reconcile counterparty and broker accounts, produce settlement billing and generate invoices. The software provides the ability to segregate duties in a controlled environment reflecting industry best practices including data validation, security privileges, limits and alerts.
BookRunner ® continues to evolve! New functionality development of our BookRunner ® software is prioritized based on annual customer feedback from our User Group conferences. Our newest release, BookRunner ® v11:
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is designed to fit companies of all size;
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liberates the application from the client server platform onto web-enabled platform to accommodate the mobile workforce;
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has a flexible trade capture tool designed with traders in mind, providing them the freedom to tailor the entire desktop as a data portal to all the information they require;
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allows for rapid deal entry;
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provides strong reporting tools, to meet tighter regulatory compliance requirements facing the industry. (This feature benefits heavily from SAS’ comprehensive offering in Business Intelligence reporting technologies);
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employs strong limit management , including value-at-risk and mark-to-market limits;
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automatically extends to SAS ® Risk Dimensions ® , our high-end analytics simulation and number-crunching engine;
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includes modules for credit risk analytics and collateral management; and is easy for IT groups to upgrade and remain current with the latest versions of Oracle software.
Our client base continues to grow! Ag Energy and CPFL are examples of two very different organizations from two very different geographies finding value from our software. Ag Energy Co-operative selected BookRunner ® v11 this year to help them set up a strong risk management program, help them sustain continued growth, and expand. Ag Energy Co-operative is Canada ’s largest farm energy co-operative supplying natural gas and electricity and related services to agricultural producers in Ontario, Canada . Michelle Vieira, Energy Portfolio and Operations Manager for Ag Energy Co-op says, “Choosing BookRunner ® made sense from the perspective that we’ve outgrown the capabilities provided by spreadsheets and needed more sophisticated deal-capture tools with great flexibility. Our team was convinced that BookRunner ® was not just a solution-software sale, but rather a solution that evolved out of RiskAdvisory’s history and experience in the gas, electric and energy marketplace.”
CPFL Energia, one of Brazil ’s largest privately owned electricity companies, is now employing SAS Risk Solutions for Energy to consolidate data on electricity sales and make better business decisions. “We selected a system to consolidate all our available information regarding the group’s electricity sales,” says Roberto Wainstock, CPFL’s Director of Electricity Sales. “With SAS, CPFL will be more agile, with a greater ability to make decisions with flexibility. Plans include consolidating existing business processes by using SAS.” The software is helping them acquire trusted data from throughout the company, which in turn is improving customer service and potential to save costs and increase profits.