Siemens will buy Altair Engineering, a company specializing in software development.
The cost of the mentioned deal will be $10.6 billion. The relevant information was made public on Wednesday, October 30, by Altair.
It is worth noting that the specified deal is part of Siemens‘ efforts to strengthen the company’s presence in the fast-growing industrial software market.
The offer price of $113 per share represents a premium of about 18.7% to Altair’s closing price last week.
The announced deal with Altair will be Siemens’ largest acquisition since Siemens Healthineers became the owner of medical device manufacturer Varian Medical Systems in 2020. The cost of the business agreement implemented four years ago, amounted to $16.4 million.
Altair develops simulation software, using which companies can predict how products will work in the real world.
Siemens is currently pursuing a strategy of applying hardware and software to combine the real and digital worlds as part of its operations. The company strives to expand beyond the traditional practice of cooperation with its industrial customers. In the context of corresponding efforts, Siemens boosts its digital offering to improve the performance of its production lines, trains, and buildings.
The new deal is expected to add to Siemens’ earnings per share in about two years. According to preliminary forecasts, the implementation of the relevant business agreement will be closed in the second half of 2025. The mentioned deal is also expected to increase Siemens’ digital business revenue by about 8%, adding approximately 600 million euros ($651.36 million) in monetary terms in fiscal 2023.
Siemens predicts that in the medium term, the buying of Altair will contribute to revenue growth of about $500 million per year. It is also expected that in the long term, the corresponding figure will increase to more than $1 billion.
Siemens competes with Rockwell Automation, Emerson Electric, and ABB in the industrial software market. Currently, the financial volume of this market is estimated at $21.5 billion annually.
As we have reported earlier, Siemens and Microsoft to Work Together on AI Assistant.
