PTC, a Boston-based company that provides internet of things (IoT), augmented reality (AR), and collaboration software, announced Thursday that it has agreed to buy cloud provider ServiceMax for $1.46 billion in… agreed in cash.
The transaction will be funded in two phases, with $808 million expected to be paid upon closing in early January and $650 million in October next year. PTC said the acquisition will allow the company to expand its portfolio of product lifecycle management offerings. The transaction is expected to be accretive to PTC’s cash flow in fiscal 2023. ServiceMax is expected to generate approximately $160 million in ARR from PTC in Q2 2023.
We reported on ServiceMax two years after the cloud provider raised $80 million in funding led by new investor Salesforce Ventures and existing investor Silver Lake to transform and advance the future of its field service.
Founded in 2007 by Athani Krishnaprasad, Hari Subramanian and Neil Barua, and based in Pleasanton, California, ServiceMax is one of the world’s leading providers of Service Execution Management, a software category that encompasses both Field Service Management and Asset Service Management. Powered by the Salesforce platform, ServiceMax offers a suite of field service applications that provide customers with a complete view of their assets, enabling them to perform more profitable and efficient service operations in complex, asset-intensive industries.
“ServiceMax and PTC have a longstanding relationship based on the shared profile of our customers, the natural synergies of our products, and a shared understanding of the importance of product data at different stages of the lifecycle,” said Neil Barua, CEO of ServiceMax. “PTC has a strong and consistent track record and now, following the growth and innovation we have achieved during our partnership with Silver Lake, we are pleased that the ServiceMax team is expanding the service offerings of PTC’s digital thread and closed loop PLM portfolio.”
Field service management, the management of a company’s resources deployed on or en route to customers’ premises rather than on company premises, is critical to the success of OEMs, operators and third parties.
The two companies have been partners since 2015. Both offer cloud-based software platforms for device manufacturers and service providers. They also work with manufacturers of complex, highly configured products such as industrial products and aerospace to track and monitor products throughout their lifecycle.
“PTC is poised to be the only company that can offer manufacturers this comprehensive view of their products at every stage of the lifecycle,” said Jim Heppelmann, PTC Chief Executive.