Automation mergers, acquisitions, capital markets analysis: February 2023
The Bundy Group reported six automation transactions in the month of February. Analysis on the acquisitions and reports are highlighted below.
Bundy Group, an investment bank and advisory firm, provides an update on mergers & acquisitions and capital placement activity in the automation market.
Highlights from the A3 Business Forum
This exciting event took place in Orlando, Florida, in January 2023. Domestic and international industry experts and leaders attended the multi-day event with the goal of discussing the automation market today, the key drivers behind this growing segment, and how businesses can capitalize on the energy.
Clint Bundy, Managing Director with Bundy Group, attended the conference, where he met with multiple business executives, owners, private equity professionals, and strategic buyers. As industry specialists in automation for more than 15 years, Bundy Group enjoys the opportunity to keep our rolodex and industry knowledge fresh. The A3 Forum validated the optimism and strength of the automation industry and its various subsegments. Bundy Group is as bullish as our team has ever been on this industry from a mergers & acquisitions (“M&A”) and capital placement perspective. Below are our major takeaways from the A3 conference.
Uninterrupted activity for the automation M&A market
The Business Forum further showcased how the automation M&A momentum continues. The automation market is in high demand from both strategic buyers and financial sponsors, which includes private equity groups and family offices. Bundy met with several financial sponsor professionals in Orlando that were networking with the intent of finding a company to invest in as a new platform. Furthermore, strategic buyers, such as Brooks Automation, Robex and ETECH, made it known they are aggressively looking for add-on acquisitions to accomplish inorganic growth. For automation business owners today, it continues to be a seller’s market, especially if they know how use a competitive process to their advantage and not fall prey to buyers seeking proprietary conversations.
The momentum in automation is driven by numerous factors, and the robotics solutions segment is a key contributor. To further the point, North American companies ordered robots valued at $2.3 billion in 2022, an 18% increase from 2021, and the total number of robots ordered in 2022 was 44,196, an impressive 11% increase from the prior year. As one executive pointed out, the lengthy list of robotics attendees at the Business Forum was a sign of the direction the automation market was gravitating. End users are clearly utilizing these solutions to run their operations, solve the talent gap issues and best position their companies for the future.
Warehouse automation has increased importance to automation providers
The warehouse automation segment is rivaling robotics for its contributions to the overall automation market. Current Bundy Group industry work and client engagements show vigorous demand for warehouse automation solutions, and this was further supported by industry presentations and conversations at the Business Forum. Examples of warehouse automation solutions include automated sortation systems, automated storage systems, automated forklifts, and Autonomous Mobile Robots, or AMRs. In one Business Forum presentation, Blake Griffin with Interact Analysis, an international market research firm, provided insights on warehouse automation trends. Interact Analysis projected the warehouse automation market, which was $36 billion in 2021, to reach $77 billion by 2027, a robust 13% compounded annual growth rate. Griffin further added that his team, which is in constant dialogue with many of the international automation players, believes that warehouse automation will become increasingly important to automation vendor strategies.
Machine vision providing in-demand solutions
Another lucrative automation segment to note from the Business Forum is the Machine Vision market. Machine vision technology offers equipment the ability to see what it is doing and then make prompt decisions based on what it has seen. Examples of machine vision components include cameras, lighting, optics, imaging boards, and software. Alex Shikany, VP for Business Intelligence for A3, provided relevant data regarding the Machine Vision market at the Business Forum. The North American Machine Vision market is valued at $3.1 billion for 2022, according to Alex, and 62% of respondents in a recent A3 survey said they expect orders to increase for these solutions over the next 12 months. The Bundy Group team shares the enthusiasm for the Machine Vision segment, and we see M&A and capital placement activity validate the attractiveness of this robust sector.
Building & realizing value event
For those business owners and executives who are interested in learning more about the automation M&A market and ways to increase value in their company, please consider attending our Building Value & Realizing Value workshop in New Orleans in May 2023. It will be held the day before the Control System Integrators Association Conference. See registration details for more. It will be an action packed, fun-filled day!
The Bundy Group team was excited not only to participate in the jam-packed informative A3 Business Forum, but to see firsthand the drive behind the current momentum in the automation industry. The Bundy Group team will be at the Control System Integrators Association Conference and the Automate Conference, both of which are in May, and looks forward to continued conversations with automation owners and executives. We also look forward to providing updates on the state of the industry and the automation M&A and capital market to the Control Engineering readers in our future monthly pieces.
February 2023 automation transactions
M-Files, a global leader in information management, has acquired Ment (formerly Contract Mill Oy), a leading no-code document automation technology company based in Espoo, Finland. With this acquisition, M-Files now delivers robust document automation capabilities that enable new and existing customers to quickly automate their own documents. Learn more.
Italia Technology Alliance (ITA Holding) continues its strategic development and welcomes Taiprora S.r.l. into its social structure, a consolidated Abruzzo-based company that has been creating software and automation systems for production and logistics for 30 years. Learn more.
Redwood Software, the industry leader in full stack automation, announced its acquisition of Cerberus, a leading secure file transfer provider that serves some of the largest global organizations. Learn more.
Addtronics, LLC (“Addtronics”), a mission-driven holding company dedicated to acquiring, empowering, and growing leading robotic automation solution providers, has acquired Missouri Tooling & Automation, LLC. (“MTA”). MTA is a leading custom robotic automation systems provider based in Lebanon, Missouri. Learn more.
Galco Industrial Electronics, Inc. (Galco) has acquired Zesco, Inc., a regional automation solutions provider located in Brecksville, Ohio. “The acquisition of Zesco further positions Galco as a global leader in the industrial automation and motion control industry,” said Allison Sabia, president and CEO of Galco. Learn more.
Built Robotics, the inventor of the robotic Exosystem and leader in construction autonomy, acquired Roin Technologies, the makers of the first automated concrete power trowel. The acquisition will grow the capabilities of Built’s engineering team and accelerate key technological developments. Learn more.
Bundy Group is a boutique investment bank that specializes in representing controls and automation, Internet of Things, and cybersecurity companies in business sales, capital raises, and acquisitions. Over the past 33 years, Bundy Group has advised and closed on over 250 transactions, which includes numerous automation-related transactions. You can learn more at www.bundygroup.com or by contacting Clint Bundy.