Aveva to acquire Schneider Electric's software unit in $858-mn reverse takeover

British industrial software developer Aveva Group Plc today said that it would buy the industrial software unit of France's Schneider Electric in a complex £550-million ($858 million) reverse takeover deal.

Under the terms of the deal, Aveva would receive Schneider Software and £550million, and in exchange Schneider Electric would receive 74 million shares, or about a 53.5-per cent stake in Aveva, worth about £1.3 billion. Aveya will remain listed in London,

Given the relative size of Schneider Software and Aveva, the transaction will be classified as a reverse takeover of Aveva under the Listing Rules of the UK Listing Authority.

Post closing, Aveva shareholders will hold a 46.5-per cent stake of the enlarged Aveva Group, with combined revenues and Adjusted EBITA of £534 million and £130 million, respectively.

Commenting on the transaction, Richard Longdon, CEO of Aveva said, "The transaction will be transformational to Aveva, creating a global leader in industrial software, which will be able to better compete on a global scale. Through the acquisition of Schneider Software, Aveva will significantly expand its scale and product portfolio, diversify its end user markets and increase its geographic exposure to the US market, in line with our strategic goals.''

"Working on a combination of Aveva and selected Schneider Electric industrial software assets represents a promising opportunity for the stakeholders of both companies. The combination will create a global leader in industrial software, with a unique portfolio of asset management solutions from design & build to operations and will address customers' requirements along the full asset life cycle in key industrial and infrastructure markets,'' said, Jean-Pascal Tricoire, chairman and CEO of Schneider Electric.

Schneider Software is a leading industrial software firm and a market leader in markets and technology areas adjacent to those of Aveva. Schneider Software comprises certain historical software assets of Schneider Electric and Invensys plc former software assets acquired in January 2014.

Its portfolio covers offerings in Process Engineering & Optimisation; Operations Planning & Scheduling; Operations Execution Management; Asset Management; Operations Control and Information Management under various brands such as Wonderware, SimSci, Avantis, Citect and ClearScada.

Schneider Software has a global footprint spanning North America, Europe, the Middle-East, Asia Pacific and Latin America with 2,000 employees worldwide, with 8 global R&D centres and 23 project execution centres.

In the year ended 31 March 2015, approximately 40 per cent of its 2015 revenues were generated from North America, 29 per cent from EMEA, 19 per cent from Asia Pacific, 8 per cent from Latin America, and 5 per cent from other markets.

Schneider Software works with 10 of the top 15 mining companies, 18 of the top 20 pharmaceutical companies, 19 of the top 20 petroleum companies, 22 of the top 45 food and beverage companies and 22 of the top 40 chemical companies.

Aveva, based in Cambridge, England, provides software for design of oil rigs, ships and power stations It was spun out of the University of Cambridge in 1967.

The company posted revenue of £208.7 million for the 31 March 2014-15 fiscal year.