Schneider Electric agrees to acquire PTC in $22.6 billion deal to expand industrial software and AI

Schneider Electric has entered into a definitive agreement to acquire PTC in an all-cash transaction valuing PTC’s equity at approximately $22.6 billion. The deal represents a major expansion of Schneider Electric’s industrial software strategy, bringing together its energy management and industrial automation capabilities with PTC’s software for product design, engineering and data management.

Under the agreement, Schneider Electric will pay $205 per share in cash for PTC, representing a 42.3% premium to PTC’s closing share price before the announcement. The transaction implies an enterprise value of approximately $23.7 billion.

The acquisition is intended to create a scaled industrial software and AI business, connecting design, engineering, operational technology and data intelligence to support industrial customers.

Bringing energy technology and industrial software together

Schneider Electric operates across energy management, electrification, automation and digital technology. PTC develops software that helps manufacturers design products, manage engineering data, oversee product lifecycles and connect information across industrial operations.

The combination is intended to bring these complementary capabilities closer together, helping customers connect product development with manufacturing and operational performance.

For industrial businesses, this convergence can support more connected workflows across the product lifecycle, from initial design and engineering through production, maintenance and ongoing optimisation.

Schneider Electric says the combined portfolio will focus on open and interoperable industrial software, enabling customers to connect systems for design, control, data and intelligence.

Advancing industrial AI and the digital thread

A central part of the transaction is the opportunity to expand the use of AI across industrial environments.

PTC’s software supports product lifecycle management, computer-aided design and application lifecycle management. These capabilities help organisations manage product information, engineering processes and complex development workflows.

Schneider Electric brings complementary capabilities in energy management, industrial automation and digital operations. Bringing the portfolios together is expected to support the development of AI-enabled digital thread solutions that connect information across the industrial lifecycle.

The companies see this as an opportunity to help customers improve efficiency, make more informed decisions and connect data across previously fragmented systems.

A proposed software group alongside AVEVA and Cognite

Following completion, PTC is expected to become part of Schneider Electric’s software group alongside AVEVA and Cognite. The proposed group will operate autonomously within Schneider Electric and report directly to the company’s CEO, Olivier Blum.

According to the transaction announcement, the combined software group would represent approximately $6 billion in revenue, serve more than 50,000 customers and employ over 15,000 people worldwide.

The structure is intended to bring together complementary industrial software businesses while maintaining an operating model designed to support their respective markets and customer needs.

Financial terms and expected synergies

Schneider Electric expects the transaction to strengthen its financial profile across areas including revenue growth, recurring revenue mix, profitability and free cash flow.

The company estimates approximately €250 million in annual cost synergies by the third year following completion, alongside approximately €800 million in revenue synergies. The expected revenue benefits are linked to cross-selling, broader customer access, expanded geographic reach and joint development of AI-enabled solutions.

The cash consideration is expected to be financed through a combination of equity and new debt issuance, supported by committed bridge financing.

These benefits remain projections and will depend on the successful completion and integration of the businesses, as well as the realisation of the anticipated commercial opportunities.

Closing the next chapter in industrial intelligence

The agreement reflects a wider shift in industrial technology, where software, AI, automation and energy systems are increasingly being developed as connected parts of business operations.

For Schneider Electric, acquiring PTC would expand its position in industrial software and provide additional capabilities across product engineering and lifecycle management. For PTC, the proposed transaction offers access to Schneider Electric’s global scale, customer relationships and industrial technology portfolio.

The acquisition remains subject to customary closing conditions, including PTC shareholder approval and regulatory clearances. Schneider Electric and PTC expect the transaction to close by the third quarter of 2027.

About Schneider Electric

Schneider Electric is a global energy technology company focused on electrification, automation and digitalisation. Its technologies and services support buildings, data centres, infrastructure and industrial operations, helping organisations manage energy and improve operational performance.

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About PTC

PTC develops software for product design, engineering, product lifecycle management and application lifecycle management. Its technologies help manufacturers and engineering organisations manage product data, coordinate development processes and connect information across the product lifecycle.

Source and Credits: PTC and Schneider Electric’s official joint announcement