Schneider Electric buys British software developer Aveva for £9.5 billion

French industrial conglomerate Schneider Electric has agreed to buy the rest of Aveva, in a deal that values ​​the British software developer’s equity at nearly £9.5bn and strips the London market of one of its few remaining major technology groups.

The French group is buying the 40% of Aveva it does not already own for £31 per share, it said in a statement on Wednesday. The deal is one of the biggest acquisitions in the UK this year.

The offer represents a premium of around 40% compared to before Schneider confirmed that he was considering a potential takeover in late August. Shares of Cambridge-based Aveva closed at £30.38 on Tuesday.

Aveva, which emerged from the University of Cambridge in the 1960s, is one of Britain’s oldest technology companies. Its software has primarily focused on the energy, infrastructure and manufacturing sectors – areas that Schneider Electric also covers – although it has expanded into other industries as well.

The French group said the deal would enable “faster execution of Schneider Electric’s software growth strategy.” Aveva will retain its Cambridge headquarters and a stand-alone team, he added.

Schneider President and CEO Jean-Pascal Tricoire said on a conference call that the company wanted to “accelerate the path to providing our customers with a data hub.” Schneider provides automation and software services, including systems to help companies improve the energy efficiency of buildings and factories.

“Energy is at the top of the agenda for all of our industrial customers,” Tricoire said.

Schneider also wants to help Aveva move to a subscription-based model and cooperate in areas such as research and development, Tricoire said.

Ahead of Schneider’s potential bid announcement, Aveva issued an earnings warning in which it flagged inflationary pressures and said growth would slow in 2022.

The British group has sought to diversify away from its core oil and gas customer base with the $5 billion acquisition of US rival OSIsoft last year.

Schneider has owned 60% of Aveva since a 2017 deal and a £3bn reverse takeover in which the French group merged its software assets with the British firm, which retained a London listing.

Schneider’s market value has risen sharply over the past four years as more of its customers have sought to save energy and use its services in areas such as data centers, although its actions have fallen by more than 30% this year. The group let go of its Russian operations in July by handing them over to local management, joining a wave of foreign companies leaving after the invasion of Ukraine.

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