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Bids, Mergers and Takeovers

AVEVA to combine with Schneider Electric

05 September 2017 07:50

AVEVA is to combine with Schneider Electric's industrial software business.

The groups said the combination - which would be classified as a reverse takeover of AVEVA - would create a global leader in industrial software, with scale and relevance in key-markets and an extensive technology portfolio with combined revenues and adjusted EBITA of around £657.5 million and around £145.8 million.

On completion, existing AVEVA shareholders and participants in the AVEVA share plans will retain 40% equity ownership of the enlarged AVEVA Group following the issue of ordinary shares in the capital of AVEVA to Schneider Electric, with Schneider Electric owning the remaining 60% on a fully diluted basis.

The value of the consideration shares to be issued to Schneider Electric is approximately £1.7 billion based on the AVEVA Group closing share price at the Latest Practicable Date.

This represents an EV/17A Adjusted EBITA multiple of approximately 19x for the Schneider Electric Software Business, broadly in line with AVEVA's multiple.

Completion, which is expected to be at or around the end of the year, is subject to the satisfaction of a number of conditions including, among other things, applicable regulatory and anti-trust approvals having been obtained, AVEVA shareholder approval, and re-admission of the enlarged AVEVA Group.

AVEVA chairman Philip Aiken said: "We are delighted to have reached agreement on the Combination with the Schneider Electric Software Business. 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.

"AVEVA will significantly expand its scale and product portfolio, increase its capabilities in the owner operator market, diversify its end user markets and increase its geographic exposure to the North American market, in line with our strategic goals.

"The transaction is expected to provide significant value to our shareholders via the upfront cash payment and a significant ongoing holding in the Enlarged AVEVA Group, which will benefit from synergies and a compelling equity story underpinned by an enhanced strategic positioning."

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Related Company: AVV

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