TOKYO — Siemens on Monday agreed to buy Mentor Graphics in a $4.5 billion deal.
Siemens, which has been beefing up its industrial software capabilities lately, sees Mentor’s electronics IC and system design, simulation and manufacturing solutions as critical for developing “smart” and “connected” products — including autonomous vehicles.
Mentor helps companies design and manufacture circuit boards and semiconductors with specialist software, notably for the aerospace and automobile industries.
Siemens is Europe’s largest engineering conglomerate, best known for its power systems. But the Germany giant is keen on playing a big role in the so-called fourth industrial revolution — big data and IoT — thus adding its expertise in software-based design and automated manufacturing through acquisitions.
Mentor acquisition is Siemens's biggest deal in the industrial software sector since it bought UGS, a U.S.-based industrial design software group, for $3.5 billion in 2007.
This year Siemens agreed to pay almost $1bn to buy CD-adapco, a US industrial software company widely used by designers in the aerospace and automotive industries.
All these acquisitions form the basis of Siemens’ digital factory division.
In the press announcement, Siemens stressed that the company is becoming “unique digital industrial player to offer mechanical, thermal, electrical, electronic and embedded software design capabilities on a single integrated platform.”
In essence, the German industrial conglomerate hopes to own a full suite of products to design solutions for everything from planes, trains and automobiles to wearable devices.
Siemens also hopes Mentor can foster the German company's holistic strategy for “mechatronics” — technology that combines mechanical engineering with electronics.
Klaus Helmrich, member of the Managing Board of Siemens, said in a statement, “With Mentor, 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.”
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