Industrial software maker Aviva to acquire data service provider OSLsoft for $5 bn

Aveva said it plans a rights issue to raise about $3.5 billion to help fund the purchase of OSIsoft, which makes software that captures data from ships, chemical boilers, power plants and other facilities in industries, including oil and gas, mining, pulp and paper and water.

Aveva is 60 per cent owned by France’s Schneider Electric, which acquired the stake three years ago.

The British company said it would use a combination of rights issues, cash on balance sheet and new debt, as well as issue shares to one of OSIsoft’s shareholders, Estudillo to fund the acquisition.

Kennedy’s Estudillo has a 50.3 per cent stake in OSIsoft, while SB/OSI, a SoftBank owned firm, holds a 44.7 per cent stake and the remaining is held by MDT Holding, which is owned by Mitsui & Co.

Integrating OSIsoft’s data management software PI System into Aveva’s comprehensive software portfolio will create an integrated data foundation that can drive big data, Cloud and AI-driven insights to create meaningful business outcomes for customers, says Aviva. 

The combination will offer their complementary products to customers, bringing together industrial software and data management to help industrial and essential organisations accelerate their digital transformational strategies as efficiency, flexibility, sustainability and resilience become increasingly urgent requirements for customers, Aviva stated in a release.

The combination will enable Aviva to grow and diversify the industries it serves as well as continue to expand its footprint in existing and new markets and geographies.

Together, Aveva and OSIsoft can provide full-stack solutions that span edge, plant, and enterprise deployment models, strengthening Aveva’s position as a global leader in industrial software. 

OSIsoft’s PI System enables customers to collect, normalize, store, and stream real-time, high-fidelity operational data to applications, analytics, and AI and ML platforms. PI System acts as a single system of record for operations data, designed for massive cloud-enabled scale and data sharing across enterprises, and enables insightful operations decision making. OSIsoft works with over 1,000 of the world’s leading power and utilities companies, 38 of the Global Fortune Top 40 oil and gas companies, all of the Global Fortune Top 10 metals and mining companies, 37 out of 50 of the world's largest chemical and petrochemical companies and 9 out of 10 of the Global Fortune Top 10 pharmaceutical companies.

The complementary product offerings of Aveva and OSIsoft will allow the combined company to continue to generate significant value for its stakeholders by creating new opportunities for innovation using new and emerging technologies, the release noted. 

“The two product suites are open and interoperable, and many customers leverage both solution sets today. As a combined entity, Aveva and OSIsoft can further deliver on their sustainability goals, driving significant benefits and value for their customers.” 

“With broader, deeper scale and scope to lead the digital transformation of the industrial sector, the combined company will drive greater efficiencies and sustainability for many diverse essential industries, including consumer packaged goods (CPG), pharmaceutical, water and wastewater, and utilities, creating strengthened product offerings,” it added.

“This will not only help us serve existing customers better but also open the flood gates to new opportunities which will accelerate the delivery of our digitisation vision. Data has been enabling organisations to more effectively determine the cause of problems by allowing them to visualise what is happening in different locations, departments and systems. This agreement will enable our customers to improve business processes as well as eliminate inefficiencies,” Craig Hayman, CEO of Aveva, said.

“Together we will be better able to service the largest digital transformation projects in history, including across industry 4.0+ and IIoT. AVEVA’s interest in OSIsoft is a testament to our talented team, and the extraordinary value of the PI System as the real-time streaming data infrastructure that powers the industrial world. Today’s announcement is the culmination of a thoughtful search for a respected organization that would mesh with our own strong mission- and customer-driven culture,” OSIsoft founder and CEO J Patrick Kennedy added.

Headquartered in Cambridge, UK, Aveva is a global leader in engineering and industrial software driving digital transformation across the entire asset and operations life cycle of capital-intensive industries. It has also the largest industrial software ecosystem, including 4,200 partners and 5,700 certified developers. It has over 4,400 employees at 80 locations in over 40 countries. 

OSIsoft’s market-leading PI System is the proven system of record for operational data in essential industries: power generation and utilities, water, oil and gas, mining, manufacturing, pharmaceutical, facilities, transportation, and more. Every day, industrial professionals in 127 countries rely on PI System. 

The deal is expected to close at the end of the year.