Schneider Electric agrees complete takeover of software developer Aveva Group

Aveva Group set to be taken over by French industrial giant Schneider Electric with software developer valued at £9.4bn

  • Schneider said he would buy the rest of Aveva shares for £31 each
  • The group intends to maintain Aveva’s head office in Cambridge
  • Britain’s few listed tech companies have been a notable target for takeovers

Aveva Group has agreed to a full takeover by Schneider Electric in a deal valuing the Cambridge-based industrial software provider at £9.4 billion.

French conglomerate Schneider had until 4pm today to declare its intentions for Aveva after telling investors a month ago that it was considering buying the 41% of the company it did not already own.

He announced this morning that he would acquire the rest of the business for £31 a share, representing a premium of around a third to Aveva’s average closing price for the three months to August 23.

Ambition: Schneider Electric said the full takeover would help accelerate both its software growth strategy and Aveva’s shift to a cloud-based hybrid subscription model

The deal is the latest in a wave of takeovers of London-listed companies by overseas buyers, who have exploited a lackluster UK stock market and a weaker pound to acquire companies at a relative discount.

Britain’s few listed tech companies have been targeted. This includes Micro Focus International, which agreed to be sold to Canadian software developer OpenText for £5.1 billion last month.

Schneider, a specialist in digital automation and energy efficiency, said its latest deal will help accelerate both its software growth strategy and Aveva’s shift to a cloud-based hybrid subscription model.

He intends to retain Aveva’s headquarters in Cambridge, where the company was founded in 1967 and is home to “Silicon Fen” due to the region’s large cluster of high-tech companies.

Jean-Pascal Tricoire, CEO of Schneider Electric, said the full takeover “will grow the business faster by simplifying decision-making, enabling seamless interactions between teams, accelerating our R&D investments and allowing for a more coordinated sales strategy”.

He added, “We are fully committed to Aveva’s self-contained, hardware-independent business model, and to maintaining the software culture that is the source of its innovation and success.

“The strong combination of Aveva’s data platform and specialized applications with Schneider Electric’s energy expertise will provide customers with tangible gains in all aspects of safety, reliability, efficiency and durability.”

Finalization of the deal is expected to take place in the first quarter of 2023, subject to approval from investors, who will receive an interim dividend worth up to 13p per share if they give a thumbs up.

Schneider became Aveva’s majority shareholder five years ago after buying a 59 per cent stake for more than £500m in a reverse takeover that saw the latter group maintain its listing in London.

It has been on a strong growth trajectory in recent years, posting 28.9 billion euros in sales in 2021, compared to 25.2 billion euros the previous year, as companies have sought to save energy and build their data centers.

Aveva President Philip Aiken said, “Customers are increasingly turning to industrial software to drive efficiency and sustainability, and the combination with Schneider Electric will enable Aveva to execute its strategy faster and to further improve its customer proposition.”

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