Europe’s largest industrial company, Siemens has decided to buy out American software company CD Adapco, for nearly a billion dollars. The details of the buyout are still kept secret as the deal has not been made entirely public yet. The spokesperson from both companies have hinted towards the deal and a possibility, but have refused to make any public comment on the deal. Most people are wary of making any public statements about the deal as it could go wrong and falsely stimulate markets too.
However, sources did mention that the deal is most likely to go through. The source asked not to be named. CD Adapco is a New York-based firm that produces software in order to simulate the inner workings of an engine. It helps many manufacturing firms to understand and recognize any faults in engines during manufacturing. CD Adapco could come in handy for Siemens as it would help the European manufacturing giant in various business parallels of the company.
Under current trends and market conditions, Siemens is undergoing a few austerity measures. With the European economy only moderately recovering, Siemens has remained cautious of its buy outs and subsidiary sell-offs. Ever since Joe Kaeser has taken over at the head of Siemens, he has made it a personal and business goal to make Siemens a larger and more profitable company again. Under Kaeser, the company has been selling off its non-essential or non-core businesses to various other companies, and plan to aim at areas of their own expertise. The aim is to also make the business operations of the company less cumbersome.
The Siemens outlook
Siemens however, is focusing on major research and development programs in order to compete with global rival General Electric who happens to have a very robust research wing. The bid to purchase CD Adapco fits right into plans by Siemens AG. CD Adapco also seems to be undergoing some interim changes as the company’s CEO and co-founder Steve MacDonald passed away, leaving his wife Sharron MacDonald as interim CEO.
CD Adapco had begun in the year 1980 and has displayed impressive growth at the rate of 15 percent ever since the past five years. The company has had revenues rise up to 200 million dollars in the past half-decade. CD Adapco clients consist of NASA and Renault racing for many for its Formula One race cars.