Schneider Electric to buy US software firm PTC in $22.6 billion deal

Oct 5 — France's Schneider Electric struck its biggest deal ever on Monday, agreeing to buy PTC ​in an all-cash deal valuing the US software company's equity at around $22.6 billion, it said in a statement.

The $205-per-share offer implies an enterprise value of $23.7 billion ‌for Boston-based PTC and represents a 42.3% premium to its last closing price.

The French engineering company's shares were down ⁠4.7% on Tradegate before the market opened, ​as investors digested the size of ⁠the acquisition alongside concerns that Schneider would be paying a substantial premium for a ‌software business facing AI-driven valuation ‌pressure and uncertain growth prospects.

"Large-scale M&A is typically unwelcome in the first ⁠instance by European investors, although Schneider Electric's deals ⁠have typically proven strategically astute, if debatable from a valuation standpoint," J.P. Morgan analysts said in a note to investors.

The transaction is the largest-ever acquisition in the history of Schneider, France's third-highest-valued listed company by market capitalisation, according to LSEG data.

Schneider said the acquisition would create a scaled industrial software and AI business built around ‌open and interoperable systems, which it expects to generate €250 million ​in annual run-rate cost savings by the third year after closing, alongside about €800 million in expected revenue synergies.

The deal continues Schneider's push into software acquisitions, having agreed to buy Cognite Holding, a privately held provider of AI software and industrial data, in June.

It will be financed through a combination of equity and new debt and is expected to be closed in the third quarter of 2027.

Schneider, once known primarily for industrial ​components like fuses and circuit breakers, now builds the backbone of data centres, supplying everything from ‌cooling units and ‌server racks to ⁠critical power distribution equipment.

The booming demand for data centres, particularly from the United States, is driving Schneider's earnings, offering a growing source of revenue helping offset weakness in some traditional electrical-equipment markets.

PTC, which provides software solutions for designing, manufacturing and servicing products across multiple ‌sectors, has also benefited from growing ​demand for its AI-powered tools.

($1 = 0.8936 euros)

(Reporting by ‌Sabrina Valle in New York, ⁠Harishankar Manoj in ​Bengaluru and Lucie Barbier and Dimitri Rhodes in Gdansk; Editing by Cynthia Osterman, Nick Zieminski and ​Milla Nissi-Prussak)

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