Tecnomatix to buy USDATA for $10.3 million in stock
Herzlia, Israel; Richardson, TX—Tecnomatix Technologies Ltd. agreed July 30 to purchase USDATA Corp. for approximately $10.3 million in stock. The transaction is expected to close in September 2003, and is subject to customary approvals and closing conditions, including approval of USDATA’s stockholders.
Tecnomatix agreed to acquire USDATA’s assets in exchange for issuance of up to 1,011,747 shares of Tenomatix, subject to some adjustments. Based on its July 29 closing price of $10.16 per share, Tecnomatrix’s shares to be issued as consideration for the acquisition are valued at approximately $10.3 million. As part of the transaction, USDATA’s primary stockholder, SCP Private Equity Partners II L.P., will purchase from Tecnomatix about 113,838 of its shares at $15.65 per share, or about $1.78 million.
The deal is expected to close in September 2003, and is subject to customary approvals and closing conditions, including approval of USDATA’s stockholders. USDATA adds that it has aggregate liquidation preferences of more than $56 million on its outstanding preferred stock. USDATA expects that the value of its remaining assets after completion of the Tecnomatix transaction will be significantly less than these preferred stock liquidation preferences.
Tecnomatix says buying 28-year-old USDATA underscores its position as the driving force in manufacturing process management (MPM) by incorporating USDATA’s widely used factory-floor and execution system software. USDATA is a longtime developer of supervisory control and data acquisition (SCADA) solutions and manufacturing execution systems (MES).
The acquisition will help Tecnomatix fulfill its vision of developing complete MPM solution spanning the entire manufacturing process lifecycle. Tecnomatix intends to integrate USDATA's FactoryLink SCADA product and its MES product Xfactory with Tecnomatix’s eMPower offering to create an environment for collaborative planning engineering and execution of manufacturing processes. This is expected to accelerate new product introductions, and provide a critical feedback loop from the factory floor to engineering, allowing manufacturers to compare shop-floor performance with original design and process plans, and to implement manufacturing improvements on an ongoing basis.
'The acquisition of USDATA is a major step forward in our strategy to broaden the footprint of MPM into other high-potential areas of manufacturing,' said Harel Beit-On, chairman and chief executive officer of Tecnomatix Technologies. 'This will enable Tecnomatix to expand our presence in the manufacturing execution systems domain and to address important industries where we do not operate today. Our expanded MPM solution will give manufacturers more visibility and control over processes on the factory floor, so that they can respond quickly to market demand and deliver to their customers the products they want, when they want them and at affordable costs.'
James Fleet, USDATA’s interim CEO and president, adds that, “USDATA customers and partners will benefit tremendously from this transaction. The strong commitment that Tecnomatix is making to the USDATA product set and customer base will insure that continuous innovation is delivered to the market. FactoryLink will continue to be available on a standalone basis, sold through USDATA’s network of highly experienced resellers and integrators.”
Beit-On adds that, 'We expect the integration of FactoryLink and Xfactory to go smoothly because of the similar open architectures our two companies have chosen to manage manufacturing data. eMPower is built on the concept of the electronic bills of processes (eBOP), which manages product operations and resources. USDATA's model-based technology will facilitate the extension of our eBOP into the execution domain to include routes, work-in-process (WIP) and orders. This enhanced eBOP will be the basis of a new class of integrated execution applications, providing customers with rich functionality and integration to their business process. We are excited, not only about the USDATA technology, but also the quality and expertise of their employees, distributors and system integrators. I am confident they will make a significant contribution to the success and growth of Tecnomatix.'
Control Engineering Daily News Desk
Jim Montague, news editor