AVEVA share price up 116 per cent as £3bn digitalisation powerhouse is formed
Fifty-one years after spinning out of Cambridge University as the CadCentre, AVEVA today completed its mission to form a globally transformational new software business leader.
AVEVA has combined with French company Schneider Electric’s industrial software business to create a Cambridge-anchored £3 billion powerhouse that will drive digital transformation across the asset and operational life cycle for capital-intensive industries. The UK share price rocketed 116 per cent – by 993p – to 1,849p as the merger was officially rubber-stamped.The merged enterprise will have unprecedented global reach as 88 per cent of leaders in capital-intensive industries say that digitalisation would increase their revenues.
AVEVA’s new CEO, Craig Hayman, said: “Despite that statistic, less than half of these companies are actually in the process of adopting a digital strategy. This represents an incredible opportunity for AVEVA to be our customer’s digital transformation partner.”
“Digitalisation demands a fundamental rethink of the way organisations operate. They need to be confident that their technology investment will deliver a high return on capital and can lower the total cost of asset ownership.
“AVEVA’s combination of proven solutions, industry-specific knowledge and a global partner ecosystem will drive innovation across capital-intensive industries, as companies plan their digital transformation journey.”
The combination brings together AVEVA’s design, engineering and construction capabilities with Schneider Electric’s industrial software business, which ranges from simulation through to real-time manufacturing operations management.
It creates a global leader in engineering and industrial software, expanding the markets and industries the company serves. Customers can benefit from improved profitability, efficiency and performance.
AVEVA now has over 4,400 people across 80 locations in over 40 countries. Its global headquarters will remain in Cambridge.
Industries served by the business include chemical; food and beverage; infrastructure and smart cities; life sciences; mining, minerals and metals; oil and gas (upstream, mid-stream and downstream); power and utilities; shipbuilding; water and wastewater.
Analysts have thrilled to the deal. Monica Schnitger, Schnitger Corporation, said: “The combination of AVEVA and Schneider Electric’s industrial software business brings together CAPEX and OPEX, creating a path to digitalisation from conceptual design to commissioning, and from operations back to revamps.
“Many industrial businesses already use software from both companies and look forward to the benefits of having these products under one developer umbrella.
“Adding in real-time production performance moves the industry one step closer to realising a digital asset that operates with full knowledge of its physical layout as well as the underlying physics of the process being conducted. I’m excited to see how AVEVA integrates processes, products and people.”
And Craig Resnick, ARC Advisory Group, added: “New technologies are accelerating the merging of the virtual design and physical equipment worlds, requiring the creation of new business models that must support the convergence IT, OT and ET to enable digital services.
“The convergence of solutions from both AVEVA and Schneider Electric’s industrial software business enables its customers to take full advantage of the complete spectrum of technologies and solutions needed to increase both their top and bottom lines to better thrive in an ultra-competitive global economy.”
• PHOTOGRAPH SHOWS: AVEVA CEO, Craig Hayman