Aveva Group Unveils Software Tie-up With Schneider Electric

The deal, which comes after two failed merger attempts in the past two years, will create an industrial software giant with combined revenues of around £658 million and earnings of some £146 million.

The transaction will see Schneider take a 60 per cent stake in the new group, creating a "global leader in engineering and industrial software". The new group's combined headquarters will be in Cambridge, where Aveva's now are, and the two parties are now in the process of selecting a new chief executive officer.

Aveva's products are used to design and manage oil rigs, ships and chemical plants, while the French multinational spans electrical components, energy management and industrial automation systems.

Philip Aiken, Chairman of AVEVA said: "We are delighted to have reached agreement on the Combination with the Schneider Electric Software Business".

James Kidd, now CEO of Aveva, will stay on until the board appoints a new chief executive, at which time Kidd will transition to the role of Deputy CEO.

AVEVA's chairman Philip Aiken said that the transaction will be transformational for FTSE50-listed group as it will build a global leader in industrial software, capable of competing better on an worldwide level.

Schneider also contributes greater exposure in North America, they said.

The merged group said it was in the process of seeking a new chief executive with experience of running a global software business.

The deal between Aveva Group and Schneider Electric may be finally here after two false starts, however the CEO of Schneider Electric believes there are now three reasons why investors should be confident about the deal this time around.

Some £550 million of cash is being contributed by Schneider Electric and £100m of excess cash on AVEVA's balance sheet will be distributed to existing AVEVA shareholders at or around completion - expected by the end of 2017.

In 2015, months of talks ended with Aveva citing "significant integration challenges... that could not be overcome without considerable additional risk and cost".

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