January 10, 2005
UGS Acquiring Tecnomatix
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UGS Acquiring Tecnomatix
UGS, a leading global provider of product lifecycle management (PLM) software and services, has announced a definitive agreement to acquire all of the outstanding equity of Tecnomatix Technologies Ltd., the leader in Manufacturing Process Management (MPM) software solutions for the automotive, electronics, aerospace and other manufacturing and processing industries, for approximately $228 million in cash, or $17.00 a share.
manufacturing-related revenue over the last four quarters.
UGS currently deploys Tecnomatix software in conjunction with its Open Manufacturing Backbone (OMB), a globally-scalable technology backbone designed to transform the process of digital manufacturing through an open environment in which third-party software applications can interoperate. As a result of the transaction being announced today, UGS now expects to speed up the integration with Tecnomatix solutions and deliver these solutions as an integral component of both its OMB and its E-factory digital manufacturing solution more quickly and seamlessly.
"Integrating Tecnomatix into UGS is a natural but significant step in our digital manufacturing strategy and should accelerate our ability to deliver this premier software on behalf of UGS and Tecnomatix customers," said Tony Affuso, chairman, CEO and president of UGS. "Customers that have committed to digital manufacturing technology from Tecnomatix and/or UGS can expect to see enhanced delivery of even deeper and richer capabilities going forward as we more fully integrate our respective solutions.
"We believe that the Tecnomatix team brings to the table a tremendous amount of industry knowledge and deep expertise in digital manufacturing technology. We expect the combination of the Tecnomatix team with UGS' PLM- and digital manufacturing-leading capabilities to enable UGS to provide unparalleled technical understanding and the deepest and broadest coverage on a worldwide basis in the digital manufacturing market."
The transaction -- which, subject to the receipt of required regulatory approvals, is expected to close by the end of the first quarter 2005 -- marks the formal linkage between UGS and Tecnomatix, which have been working closely together through a strategic alliance since 2002. Following the close of the transaction, the companies intend to offer a fully integrated solution of Tecnomatix MPM to UGS Teamcenter users while continuing to offer Tecnomatix' leading open standalone MPM solution integrated with the PLM environment of choice for its customers. In addition, the companies intend to announce additional technology enhancements later this year.
"We are confident that the combined technologies and know-how of both companies will enable us to offer the best manufacturing planning and execution solution for the benefit of all customers," said Harel Beit-On, chairman of Tecnomatix. "In addition, unlike with other technology acquisitions, this one is prefaced by more than two years of close collaboration between our companies, so the formal integration of Tecnomatix technologies into UGS' digital manufacturing solution promises to go very smoothly.
"The two organizations have been working well for the past two years and the Tecnomatix employees are looking forward to becoming a part of the leading PLM team in UGS."
The Tecnomatix transaction marks UGS' fourth technology acquisition since the company launched independent operations in May 2004.
"UGS continues to grow its franchise through its dedication to offering the world's best product lifecycle management software to its customers, and the addition of Tecnomatix to the UGS family is a major step forward in that effort," Affuso said. "Along with sustained internal spending on research and development, these acquisitions have added significant value to our technology platform, which was already second to none in the PLM industry."
Tecnomatix Agrees To Be Acquired By UGS
Tecnomatix Technologies Ltd. (NASDAQ:TCNO), a leader in Manufacturing Process Management (MPM), today announced that it has entered into a definitive agreement for all of its outstanding equity to be acquired by Plano, Texas-based UGS, a leading global provider of product lifecycle management (PLM) software and services.
Under the agreement, and subject to the satisfaction of certain customary conditions, including approval by Tecnomatix shareholders and regulatory authorities, shareholders will receive $17.00 per share in cash for each Tecnomatix share they own. This represents a premium of 39% to Tecnomatix's average closing price over the last 60 trading days. The transaction implies a total equity value of $227.7 million (based on 12.2 million shares outstanding and assuming exercise of 2.9 million options).
Tecnomatix's founders and other significant shareholders owning approximately 13% of the outstanding shares have irrevocably committed to vote in favor of the acquisition. The transaction has received the unanimous support of Tecnomatix's Board of Directors and, subject to the receipt of required regulatory approvals, is expected to be completed by the end of the first quarter 2005.
manufacturers around the world will realize even greater business value and product introduction success."
Jaron Lotan, president and CEO of Tecnomatix said: "UGS is uniquely positioned to acquire Tecnomatix after two years of close collaboration. Joining UGS will enable Tecnomatix to benefit from the vast technical resources, as well as the broader market coverage of this leading enterprise solution provider. This combination will offer customers an integrated IT solution combining UGS' enterprise capabilities with Tecnomatix's industry leading digital manufacturing products and services. Tecnomatix employees can look forward to personal growth as part of UGS."
look forward to Tecnomatix employees, with their in-depth knowledge and experience, becoming part of our organization. Following the acquisition, it is UGS' intention to continue to support all existing Tecnomatix customers and solutions."
Tecnomatix is being advised by Morgan Stanley on this transaction.
While both of the news items above obviously announce basically the same thing, we thought we'd run them both to get the perspective of each of the companies involved in the transaction. Outwardly, this looks like a good deal for both parties and makes a lot of sense, and is not too surprising. Not too surprising because UGS and Tecnomatix have had an increasingly close relationship the past few years. The technologies offered by each company are quite complementary to each other, so should result in a good fit.
execution of production processes, and provide real-time control and visibility throughout all levels and processes of shop-floor operations.
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-- Jeff Rowe, MCADCafe.com Contributing Editor.
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