Schneider acquires PTC for $22.6 billion

Schneider Electric has agreed to acquire US industrial software company PTC for approximately $22.6 billion in cash, with an enterprise value of about $23.7 billion. The company states that this acquisition aims to create one of the largest industrial software portfolios.

The offer is $205 per share, representing a premium of 42.3% over the last closing price and a premium of 46.1% over the volume-weighted average price of the last 30 trading days. The enterprise value multiple corresponds to 21 times the expected adjusted EBITDA for 2027, and 13 times when accounting for all synergies. The transaction is planned to be completed before the third quarter of 2027, funded by equity and new debt.

Post-acquisition, software and service revenue is expected to rise to about 24% of group revenue, with over 15,000 software employees and more than 50,000 software customers. PTC, headquartered in Boston, provides software for the design, engineering, and data management of complex industrial products. Schneider claims the combination will fill the gap in product lifecycle software and maintain open connectivity for design, control, data, and intelligent systems.

This is Schneider's second software acquisition this year. In June, the company agreed to acquire private industrial AI and data software company Cognite. In July, it raised its full-year revenue forecast based on record performance in the first half of the year and demand for industrial software and AI tools. PTC itself is also increasing orders through AI capabilities.

Schneider started with electrical hardware like circuit breakers and has recently focused on data centers and software. The purchase of PTC integrates factory design, production, and service software with its existing energy management and automation business. Negotiations were reported on Sunday, with valuation discussions around $20 billion. The final agreement was confirmed by both parties on Monday.

This is an event-driven industrial merger and acquisition, not a spontaneous revaluation in the secondary market. The buyer is Schneider's shareholders and debt providers, while the seller is PTC shareholders accepting $205 in cash. Funds are flowing from the electrical equipment group's balance sheet to the industrial software equity. Beneficiaries include PTC shareholders and factory customers needing integrated design to operations solutions, while competitors like Siemens, Rockwell, and Emerson, who also sell industrial software, are under pressure, as is Schneider, which needs to prove synergies for the $23.7 billion enterprise value.

Source: Public information