Tag Archives: Rockwell
(Reuters) – Factory automation equipment maker Rockwell Automation said on Monday it would buy an 8.4 percent stake in PTC for $ 1 billion as it looks to build on its software capabilities to make smarter manufacturing processes for customers.
Rockwell — which makes electronic motor starters, relays and timers for industries — has been strengthening its capabilities in the so-called Internet of Things (IoT), or technology that allows different devices and systems to communicate with each other over the internet.
Shares of PTC, which offers computer-aided design (CAD) programs as well as lifecycle management software for manufacturers, rose as much as 10.2 percent to a record $ 95.88.
“We do view this agreement as a strategic positive for PTC as it will help open the doors into thousands of companies that traditionally have not used PTC for its core CAD capabilities,” JP Morgan analyst Sterling Auty wrote in a note.
As part of the deal, Rockwell will acquire 10.6 million newly issued PTC shares for $ 94.50 per share, to become its third-biggest shareholder.
The per-share price represents a premium of 8.6 percent to software maker PTC’s close on Friday.
Leveraging Rockwell’s domain expertise with PTC’s technology will help companies to capitalize on the promise of industrial IoT, PTC Chief Executive Officer Jim Heppelmann said.
Rockwell Automation’s chairman and Chief Executive Officer Blake Moret will join PTC’s board after the deal closes, which is expected within the next two months, according to a joint statement.
Morgan Stanley & Co LLC was the financial adviser to PTC, while Goldman Sachs & Co LLC advised Rockwell.
Goodwin Procter LLP was PTC’s legal adviser to PTC, while Foley & Lardner LLP advised Rockwell.
Reporting by Ankit Ajmera in Bengaluru; Editing by Shounak Dasgupta
Under the deal, Rockwell shareholders will receive $ 140 per share in stock and cash, split between $ 93.33 in cash and $ 46.67 in United Tech stock, the companies said in a statement.
The offer represents an 18 premium to Rockwell’s closing share price on Aug. 3, the day before media reported that UTC was weighing a bid for Rockwell.
Under the deal, the companies said that Rockwell Collins and UTC’s aerospace systems segment will be combined to create a new business unit named Collins Aerospace Systems.
“This acquisition adds tremendous capabilities to our aerospace businesses and strengthens our complementary offerings of technologically advanced aerospace systems,” UTC’s chairman and chief executive officer, Greg Hayes, said in the statement.
“Together, Rockwell Collins and UTC Aerospace Systems will enhance customer value in a rapidly evolving aerospace industry by making aircraft more intelligent and more connected,” he said.
The deal, which includes $ 7 billion in Rockwell’s debt, is expected to save more than $ 500 million by the fourth year after its completion, the companies said.
Morgan Stanley & Co LLC was the financial adviser to United Tech and Wachtell, Lipton, Rosen & Katz was its legal adviser.
Reporting by Yashaswini Swamynathan in Bengaluru; editing by Leslie Adler.