BY Fraser Tennant
With the aim of expanding its portfolio of product lifecycle management offerings, US computer software firm PTC is to acquire its peer, cloud-based software platform company ServiceMax, in a transaction valued at approximately $1.5bn.
Under the terms of the definitive agreement, the transaction will be funded in two stages, with $808m paid upon closing and $650m paid in October 2023. The transaction will be funded with cash on hand, borrowings under PTC’s existing credit facility, and a new $500m committed term loan.
The acquisition is expected to strengthen PTC’s closed-loop product lifecycle management offerings by extending the digital thread of product information into downstream enterprise asset management and field service management capabilities.
“The addition of ServiceMax will realise a key part of PTC’s closed-loop PLM strategy,” said Jim Heppelmann, president and chief executive of PTC. “The PLM capabilities PTC has long offered to engineering and manufacturing departments provide the system of record for the digital definition of any product configuration. ServiceMax will complement this by providing the system of record for monitoring and servicing product instances after they leave the factory and move into customer use.
Partners since 2015, PTC and ServiceMax both support manufacturers of complex, highly configured products for the medical device, industrial products, aerospace and related verticals. These manufacturers view field service as a strategic part of their businesses to maintain product performance, extend their products’ lifecycles, increase customer satisfaction, drive revenue growth and expand profitability.
“ServiceMax and PTC have a longstanding relationship rooted in the common profile of our customers, the natural synergies of our products and a shared understanding of the importance of product data at different stages of the lifecycle,” said Neil Barua chief executive of ServiceMax. “PTC has a strong and consistent track record of success, and now following the growth and innovation we have achieved during our partnership with Silver Lake, we are excited for the ServiceMax team to strengthen the service offerings of PTC’s digital thread and closed-loop PLM portfolio.”
Global private equity firm Silver Lake had bought a majority stake in ServiceMax in 2019.
Subject to the satisfaction of regulatory approval and other applicable closing conditions, the transaction is expected to close in early January 2023.
News: Software firm PTC to buy peer ServiceMax for about $1.5 bln