building its Vision 2020 to shape Digital Industrial Enterprise by expanding
its unique portfolio for industrial software. Siemens and Mentor Graphics (NASDAQ:
MENT) (“Mentor”) announced that they have entered into a merger
agreement under which Siemens will acquire Mentor for $37.25 per share in cash,
which represents an enterprise value of $4.5 billion. The offer price
represents a 21% premium to Mentor’s closing price on November 11, 2016, the
last trading day prior to the announcement. Mentor’s Board of Directors
approved and declared advisable the merger agreement, and Mentor’s Board of
Directors recommends the approval and adoption of the merger agreement by the
holders of shares of Mentor common stock. Mentor shareholder Elliott Management
has committed to support the transaction.
decisively extends Siemens’ leading Digital Enterprise Software portfolio with
Mentor’s well established electronics IC and systems design, simulation and
manufacturing solutions. These capabilities are essential for today’s smart
connected products such as autonomous vehicles. The combination provides
mechanical, thermal, electronic and embedded software tools which will allow
Siemens’ customers to further accelerate their innovation, drive production
efficiencies and optimize the operation of their products in the field. Now,
for the first time, quality, efficiency, flexibility, safety and speed can be
optimized across technical domains, throughout the entire lifecycle and for the
entire extended enterprise.
acquiring Mentor as part of its Vision 2020 concept to be the Benchmark for the
New Industrial Age. It’s a perfect portfolio fit to further expand our digital
leadership and set the pace in the industry,” said Joe Kaeser, President
and CEO of Siemens AG.
we’re acquiring an established technology leader with a talented employee base
that will allow us to supplement our world-class industrial software portfolio.
It will complement our strong offering in mechanics and software with design,
test and simulation of electrical and electronic systems,” said Klaus
Helmrich, member of the Managing Board of Siemens.
headquartered in Wilsonville, Oregon, U.S., and has employees in 32 countries
worldwide. In its fiscal year ended January 31, 2016, Mentor had over 5,700
employees and generated revenue of approximately $1.2 billion with an adjusted
operating margin of 20.2%. Siemens expects these attractive margins to continue
in the future and contribute significantly to the Product Lifecycle Management
(PLM) software business of Siemens Digital Factory (DF) Division, which Mentor
will join. Mentor serves a large, diverse customer base of marquee systems
companies and IC/semiconductors companies with over 14,000 global accounts
across communications, computer, consumer electronics, semiconductor,
networking, aerospace, multimedia, and transportation industries. Mentor is
viewed as a global leader in strategic industry segments including IC design,
test and manufacturing; electronic systems design and analysis; and emerging
markets including automotive electronics.
Mentor’s technology leadership and deep customer relationships with Siemens’
global scale and resources will better enable us to serve the growing needs of
our customers, and unlock additional significant opportunities for our
employees,” said Walden C. Rhines, chairman and CEO of Mentor.
“Siemens is an ideal partner with financial depth and stability, and their
resources and additional investment will allow us to innovate even faster and accelerate
our vision of creating top-to-bottom automated design solutions for electronic
systems. We are excited to join the Siemens family, as it is clear they share
the same values and focus on customer success, and are pleased that this
transaction provides immediate and certain value to our stockholders.”
achieve synergies through a combination of revenue growth and anticipated
margin expansion, with a total EBIT impact of over €100 million within 4 years
from closing the transaction. Additionally, the transaction is expected to be
EPS accretive within three years from closing. Closing of the transaction is
subject to customary closing conditions and is expected in Q2 of calendar 2017.
Mentor will be part of the PLM software business of Siemens’ DF Division. DF is
the industry leader in automation technology and a leading provider of PLM
Mentor’s electronic design automation solutions and talented experts to our
team, we’re greatly enhancing our core competencies for product design that
creates a very precise digital twin of any smart product and production
line,” noted Helmrich.