With this acquisition, ABB will be well-positioned to capitalize on the growth opportunities arising from the Fourth Industrial Revolution. Furthermore, ABB is taking a step toward expanding its digital offering by combining its industrial portfolio of digital solutions, ABB Ability, along with its extensive installed base, customer reach, and tailored automation solutions, with B&R's powerful application and software platforms.
Ulrich Spiesshofer, CEO of ABB, stated: “B&R is a gem in the world of machine and factory automation, and this combination is a once-in-a-lifetime opportunity. This transaction marks a true milestone for ABB, as B&R will fill a long-standing gap in ABB’s automation offering. It’s a perfect fit that will make us the only industrial automation supplier capable of offering customers the full spectrum of technology and software solutions, covering all aspects of measurement, control, actuation, robotics, digitalization, and electrification. This acquisition is perfectly aligned with our Next Level strategy. With our unique digital offering and our installed base of more than 70 million connected devices, 70,000 control systems, and now more than 3 million automated machines and 27,000 factory installations worldwide, we will enable our combined installed customer base to capitalize on the enormous opportunities arising from the Fourth Industrial Revolution.”.
Josef Rainer, co-founder of B&R, commented: “This combination offers fantastic opportunities for B&R, its customers, and its employees. We are convinced that ABB provides the best platform for the next chapter of our growth story. ABB’s global presence, its digital offering, and its complementary portfolio will be essential for us to accelerate our pace of innovation and growth.”.
Erwin Bernecker, co-founder of B&R, added: “This is an important signal for our employees, as our Eggelsberg operations will become ABB’s global hub for machine and factory automation. What’s most important to me is that the two companies and their employees are such a good fit that our founding headquarters will play such a vital role.”.
With this acquisition, ABB becomes the largest player in industrial automation in Austria. ABB has operated in Austria for over 100 years. Austria, especially Upper Austria, will benefit from the significant role that B&R and its Austrian headquarters will play as part of ABB. The planned expansion of R&D and production activities in Eggelsberg and Gilgenberg will strengthen Austria's high-tech industrial landscape.
Financial aspects of the transaction:
The transaction multiple is consistent with other valuations of similar companies. Both parties have agreed not to disclose the purchase price. ABB will finance the acquisition with cash. The transaction is expected to generate earnings per share in the first year and add significant synergies of 8% to B&R's standalone revenue in year four. The transaction is expected to close in the summer of 2017, subject to regulatory approvals.
