Siemens has signed an agreement to acquire Altair Engineering Inc., a leading provider of software in the industrial simulation and analysis market. Accordingly, Altair shareholders will receive USD 113 per share, representing an enterprise value of approximately USD10 billion.

With this acquisition, Siemens strengthens its position as a leading technology company and its leadership in industrial software.

“Acquiring Altair marks a significant milestone for Siemens. This strategic investment aligns with our commitment to accelerate the digital and sustainability transformations of our customers. Specifically, by combining the real and digital worlds. The addition of Altair’s capabilities…with Siemens Xcelerator will create the world’s most complete AI-powered design and simulation portfolio,” said Roland Busch, President and CEO of Siemens AG.

On the other hand, Ralf P. Thomas, CFO of Siemens AG said the acquisition is a logical step, noting the company has been building its grit in industrial software for 15 years.
In addition, Thomas said, “The acquisition of Altair is highly synergistic, underpinning Siemens’ stringent capital allocation, balancing investments and shareholder returns on the basis of a strong balance sheet. The transaction is expected to be EPS accretive two years post-closing.”

By adding Altair’s highly complementary simulation portfolio, with strength in mechanical and electromagnetic capabilities, we are enhancing our comprehensive Digital Twin to deliver a full-suite, physics-based, simulation portfolio as part of Siemens Xcelerator. Altair’s data science and AI-powered simulation capabilities allow anyone, from engineers to generalists, to access simulation expertise to decrease time-to-market and accelerate design iterations. Additionally, Altair’s data science capabilities will unlock Siemens’ industrial domain expertise in product lifecycle and manufacturing processes.

Significant synergies, EPS accretive

The transaction will strongly increase Siemens’ digital business revenue by +8%. Particularly, adding EUR ~600 million to Siemens’ digital business revenue of EUR 7.3 billion as reported in fiscal year 2023.
Siemens expects to achieve significant revenue synergies, especially from cross-selling of the highly complementary portfolios.

Moreover, from providing Altair full access to Siemens’s global footprint and global industrial enterprise and customer base. This will stir a revenue impact of more than USD 500 million p.a. mid-term growing to more than USD 1.0 billion p.a. long-term. Furthermore, Siemens aims to achieve cost synergies on a short-term basis, with an EBITDA impact of more than USD 150 million p.a. by year two post-closing.

The acquisition’s financing will come from Siemens’ existing resources and its capacity to fully finance the transaction based on Siemens’ strong balance sheet. Preemptive deleveraging is supported by significant cash proceeds from the already closed Innomotics divestment. In addition, Siemens has substantial financing potential from the sale of shares in listed entities. Closing of the transaction is subject to customary conditions and is expected within the second half of calendar year 2025.

Leader in Computational Science, AI

Altair Engineering is a global leader in computational science and artificial intelligence (AI). Specifically, providing software and cloud solutions in Simulation and Analysis, Data Science and AI, and High-Performance Computing. Thus, enabling organizations across all industries to compete more effectively and drive smarter decisions in an increasingly connected world.

Founded in 1985, Altair Engineering Inc. went public in 2017 (Nasdaq) with headquarters in Troy, Michigan. Out of its more than 3,500 employees, approximately 1,400 employees work in R&D.

11 November 2024