25 August 2020 08:38

Vitol Ian Roper Taylor Chief Executive

Aveva to Buy SoftBank-Backed Osisoft in $5 Billion Deal

Cambridge-based software giant Aveva has spent five billion US dollars (£3.8 billion) on a SoftBank-backed data company from California. The acquisition will see the UK company take over a business on the other side of the pond that it believes will compliment its own. OSIsoft collects huge streams of data from mines, factories, or other industrial sites, and helps a company analyse it. Founded in 1980 by Dr Patrick Kennedy, the business calls itself a global leader in real-time industrial data software and services. It employs 1,400 people and is used at 14,000 sites across 127 countries, counting nine of the Global Fortune Top 10 pharmaceutical companies among its customers, as well as most of the world's main oil and gas firms.

In an online ad, OSIsoft asks: "How come your data isn't performing incredible feats? How come you haven't achieved digital transformation nirvana yet?" It promises to collect data and turn it "into insight" for customers. OSIsoft had 152.2 million dollars (£116 million) in adjusted earnings before interest and tax (Ebit) on revenue of 488.5 million dollars (£373 million) in the most recent financial year. Its ownership is currently split between Dr Kennedy and his family, who own just over 50% of its shares, SoftBank, with just under 45%, and Mitsui & Co, which owns the remaining 5%. We are thrilled to be joining forces with @AVEVAGroup to accelerate the digital transformation of essential industries.

#PISystem pic.twitter.com/F8rQ7l9OJa — OSIsoft (@OSIsoft) August 25, 2020 Dr Kennedy said: "Joining forces with Aveva enhances and extends our ability to deliver on our key commitments to our customers, partners and employees. Pay based on use Get Started Purchase a Team or Enterprise subscription for per week You will be billed per month after the trial ends Aveva AVV, +1.50% said it's buying OSIsoft for $5 billion in a mostly cash deal to expand its position in industrial software. Aveva is buying the company that's 53% held by its founder and 45% held by SoftBank 9984, +2.44% to create a company with revenue of about £1.2 billion and Adjusted EBIT of around £330 million, or a 28% margin. Aveva shareholder Schneider Electric SU, +0.71%, which holds 60% of the U.K. company, is voting for the deal and will participate in the $3.5 billion sale of discounted shares, or rights issue, to fund the acquisition. OSIsoft's founder, Dr. J.

Patrick Kennedy, will become chairman emeritus and hold roughly 4% of the combined company. (Bloomberg)--Aveva Group Plc has agreed to buy Osisoft in a deal that gives the SoftBank Group Corp.-backed industrial software maker an enterprise value of $5 billion. About $4.4 billion of the deal will be paid in cash, funded by the balance sheet and a $3.5 billion rights issue, Cambridge, England-based Aveva said in a statement on Tuesday. Osisoft is jointly owned by SoftBank's Vision Fund and founder and Chief Executive Officer J. Patrick Kennedy's family as well as Mitsui & Co. with a 5% stake. Read more: Aveva Group Is in Talks to Buy SoftBank-Backed Osisoft The deal plays into industrial companies' broader shift toward software-based automation that helps factories run more efficiently. Osisoft, founded in 1980 and based in San Leandro, California, makes data-management tools for the utility, pharmaceutical and oil and gas industries and says its PI System helps customers identify areas for cost savings, extend the life of their equipment and expand production capacity. Kennedy's fund will get about $600 million in the deal, and he'll remain at the company as chairman emeritus, Aveva said. The rights issue to fund the deal is the largest announced by a U.K. company this year, according to data compiled by Bloomberg. Although British firms are tapping the equity market in droves to shore up cash balances depleted by the coronavirus crisis, many are increasingly leveraging their rising stock prices to build up war chests for expansion. Aveva had confirmed talks for the company earlier this month, following a Bloomberg report on the negotiations. Aveva's majority owner, Schneider Electric SE, has agreed to support the transaction, which is expected to close around the end of the year. Aveva combined with Schneider's industrial software arm in 2018. Mitsui also said it will sell its stake. Aveva shares rose 1.5% to 4,398 pence at 8:31 a.m. in London after earlier gaining as much as 3.8%. The stock has declined about 5.5% this year. The combined company will have annual revenue of about 1.2 billion pounds ($1.6 billion). Osisoft reported sales of $488.5 million and adjusted earnings before interest and tax of $152.2 million in the 12 months ended in June, according to the statement. SoftBank, which acquired a holding in Osisoft in 2017 and owns a 44.7% stake, has been selling assets including a large chunk of T-Mobile US Inc. to finance stock buybacks and pay down debt. Its Vision Fund lost 1.9 trillion yen ($17.9 billion) in the last fiscal year after writing down the value of investments in firms including WeWork and Uber Technologies Inc. (Updates with context on rights issue in third paragraph) For more articles like this, please visit us at bloomberg.com Subscribe now to stay ahead with the most trusted business news source. ©2020 Bloomberg L.P. Software giant Aveva signs £3.8bn deal to buy OSIsoft Engineering and industrial software giant Aveva has agreed to buy California-based data company OSIsoft in a massive 5 billion dollar (£3.8bn) deal. By Greg Wright Tuesday, 25th August 2020, 7:51 am Updated Tuesday, 25th August 2020, 7:56 am The deal has been announced to the stock exchange. OSIsoft has around 1,400 employees and its systems are used on 14,000 sites in 127 different countries. It helps customers ranging from large oil companies and miners to pharmaceutical giants to collect and analyse their data. In the 12 months to June 30, OSIsoft had revenue of 488.5 million dollars (£373 million) and adjusted earnings before interest and tax (Ebit) of 152.2 million dollars (£116 million). Sign up to our daily newsletter The i newsletter cut through the noise Sign up Thanks for signing up! Sorry, there seem to be some issues. Please try again later. Submitting... Aveva chief executive Craig Hayman said: "The acquisition of OSIsoft is perfectly in line with our strategic vision and it will accelerate the enlarged group's role in the digitisation of the industrial world, which is being driven by a need for sustainability, the industrial internet of things, cloud, data visualisation and artificial intelligence. "The acquisition will enable Aveva to broaden and deepen its relationships with existing and new customers and bring a more comprehensive product portfolio to market." Dr J Patrick Kennedy, the founder and chief executive of OSIsoft, said: "Joining forces with Aveva enhances and extends our ability to deliver on our key commitments to our customers, partners and employees. "Together we will be better able to service the largest digital transformation projects in history." Support The Yorkshire Post and become a subscriber today. Your subscription will help us to continue to bring quality news to the people of Yorkshire. In return, you'll see fewer ads on site, get free access to our app and receive exclusive members-only offers. So, please - if you can - pay for our work. Just £5 per month is the starting point. If you think that which we are trying to achieve is worth more, you can pay us what you think we are worth. By doing so, you will be investing in something that is becoming increasingly rare. Independent journalism that cares less about right and left and more about right and wrong. Journalism you can trust. Thank you