Aveva buys US tech firm OSIsoft for $5bn

UK software group Aveva said it had agreed to buy US-based real-time data software maker OSIsoft for $5bn including debt.

Aveva said the deal would strengthen its position in industrial software, with combined proforma revenue of about £1.2bn and adjusted earnings (EBIT) of £330m for the enlarged group.

The acquisition was expected to be funded by a combination of a rights issue, cash on balance sheet, new debt facilities and issuing new shares.

Aveva said it would raise $3.5bn through a rights issue to fund the deal, with a further $900m from cash reserves and a new debt facility. The FTSE 100 firm is also issuing shares to OSIisoft founder J. Patrick Kennedy, who will own about 4% after the deal completes later this year and remain with the enlarged group in the new role of chairman emeritus.

“The combination of AVEVA and OSIsoft will accelerate our Aveva partnership with significant customer value across process and hybrid automation industries plus the building and infrastructure sectors,” the company said on Tuesday.

Aveva also said its biggest shareholder Schneider Electric had agreed to vote for the deal and take part in the rights issue.

Kennedy's Estudillo has a 50.3% stake in OSIsoft, while the Softbank-owned SB/OSI holds 44.7% stake and the rest held by Mitsui & Co's MDT Holding.

Aveva was formed in 1967 as a government-funded research institute to promote computer-aided design in British industry and went private in 1983 before a management team bought it out in 1994.

The group then went public in 1996 and in 2018 merged with the industrial software arm of France’s Schneider Electric.