Tecnomatix to Acquire USDATA Corporation, Strengthening Reach Across All Areas of Manufacturing


Tecnomatix Underscores Position as Manufacturing Process
Management (MPM) Leader by Incorporating Widely Used Factory Floor
and Execution Systems Software


HERZLIA, Israel and RICHARDSON, Texas--(BUSINESS WIRE)--July 30, 2003-- Tecnomatix Technologies Ltd. (NASDAQ: TCNO), the driving force in Manufacturing Process Management (MPM), today announced that it has agreed to acquire substantially all the assets of USDATA Corporation ( www.usdata.com), a leading developer of supervisory-level control (SCADA) and manufacturing execution systems (MES). The acquisition is in line with Tecnomatix' vision for a complete MPM solution spanning the entire manufacturing process lifecycle.

Tecnomatix intends to integrate USDATA's SCADA product FactoryLink(R) and its MES product Xfactory(R) with the Tecnomatix eMPower(TM) offering to create an environment for collaborative planning engineering and execution of manufacturing processes. This will accelerate new product introductions and provide a critical feedback loop from the factory floor to engineering, allowing manufacturers to compare shop-floor performance with original design and process plans, and to implement manufacturing improvements on an ongoing basis.

"The acquisition of USDATA is a major step forward in our strategy to broaden the footprint of MPM into other high-potential areas of manufacturing," said Harel Beit-On, chairman and chief executive officer of Tecnomatix Technologies. "This will enable Tecnomatix to expand our presence in the manufacturing execution systems domain and to address important industries where we do not operate today. Our expanded MPM solution will give manufacturers more visibility and control over processes on the factory floor, so that they can respond quickly to market demand and deliver to their customers the products they want, when they want them and at affordable costs."

"USDATA customers and partners will benefit tremendously from this transaction," said James E. Fleet, interim CEO and president of USDATA Corporation. "The strong commitment that Tecnomatix is making to the USDATA product set and customer base will insure that continuous innovation is delivered to the market. FactoryLink(R) will continue to be available on a standalone basis, sold through the USDATA network of highly experienced resellers and integrators."

"We expect the integration of FactoryLink(R) and Xfactory(R) to go smoothly because of the similar open architectures our two companies have chosen to manage manufacturing data," Beit-On continued. "eMPower is built on the concept of the electronic bills of processes (eBOP), which manages product operations and resources. USDATA's model-based technology will facilitate the extension of our eBOP into the execution domain to include routes, work-in-process (WIP) and orders. This enhanced eBOP will be the basis of a new class of integrated execution applications, providing customers rich functionality and integration to their business process. We are excited, not only about the USDATA technology, but also the quality and expertise of their employees, distributors and system integrators. I am confident they will make a significant contribution to the success and growth of Tecnomatix."

Tecnomatix announced the agreement in consideration for the issuance of up to 1,011,747 Tecnomatix shares, subject to certain adjustments. Based on the closing price of $10.16 per Tecnomatix share as of July 29, 2003, the shares to be issued as consideration for the acquisition are valued at approximately $10.3 million. As part of the asset purchase transaction, SCP Private Equity Partners II, L.P., the primary stockholder of USDATA, will purchase from Tecnomatix 113,838 of its shares at $15.65 per share.

About Tecnomatix Technologies and eMPower

Tecnomatix Technologies Ltd. is the driving force in Manufacturing Process Management (MPM). Today's leading global manufacturers are adopting MPM solutions to expand revenue potential and reduce costs by accelerating product introductions, shortening time to volume, and optimizing production execution. eMPower enables our customers to succeed with its collaborative, open platform and applications for defining, simulating, managing, and executing manufacturing processes across the extended enterprise. For more information on eMPower products and solutions for MPM, please visit www.tecnomatix.com.

About USDATA

Now in its 28th year, USDATA Corporation, headquartered in Richardson, Texas is a leading global provider of software and services that give enterprises the knowledge and control needed to perfect the products they produce and the processes they manage. Based upon a tradition of flexible service, innovation and integration, USDATA's software currently operates in a variety of industries in more than 60 countries around the globe. Customers include seventeen of the top twenty-five manufacturers. USDATA's software heritage has emerged from manufacturing and process automation solutions and has grown to encompass vast product knowledge and control solutions. The company has a global network of distribution and support partners. For more information, visit USDATA at www.usdata.com.

About FactoryLink and Xfactory

The highly scalable FactoryLink product, created by USDATA in 1986, provides the process knowledge and control needed to perfect the products companies make and the processes they manage. It is now one of the manufacturing and process industry's most widely used automation products. Introduced in 1998, USDATA's Xfactory product is designed to track all aspects of discrete manufacturing production in real time. Xfactory maintains historically accurate records, and provides defect tracking and complete product genealogy. Data gathered and analyzed by this powerful product give companies the insight needed to improve production performance and meet the changing requirements of customers dynamically, while generating enhanced competitive advantage. To date, USDATA has shipped more than 80,000 copies of FactoryLink and Xfactory to customers in over 100 countries. For more on FactoryLink and Xfactory, see www.usdata.com/solution/eps.html.

This press release includes forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, which are subject to risks and uncertainties that could cause actual results to differ materially from those anticipated. Such statements may relate to the Company's plans, objectives and expected financial and operating results. The risks and uncertainties that may affect forward-looking statements include, but are not limited to: currency fluctuations, global economic and political conditions, market demand for Tecnomatix products and services, long sales cycles, new product developments, assimilating future acquisitions, maintaining relationships with customers and partners, and increased competition. For more details about the risks and uncertainties of the business, refer to the Company's filings with the Securities and Exchange Commission. Tecnomatix undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

CONTACT: Company Contact:
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