Software firm Delcam set to be acquired by US rival in £172m deal

BIRMINGHAM-based software company Delcam is set to be acquired by a US rival in a deal which values the business at more than £172m.

The deal was announced in a statement to the London Stock Exchange this morning.

It said the boards of Autodesk Development, a wholly-owned subsidiary of Autodesk Inc, based in San Rafael, California, and Delcam had reached an agreement on a deal that will see the US firm acquire the entire issued share capital of the Small Heath firm at a price of £20.75 per share. The deal values Delcam at £172.5m.

Delcam is the UK’s leading developer and supplier of advanced software solutions for product development, manufacture and metrology. The group’s software is used by almost 45,000 organisations worldwide, ranging across a variety of industries, including aerospace, automotive, footwear, medical and dental, toys and sports equipment.

Its growth has been substantial in recent years, based on a strong export policy and a willingness to explore new markets such as Brazil.

In August it announced record interims with revenues up 9% to £25m (2012: £22.9m) – the seventh consecutive six-month period of record revenues. Pre-tax profit were up 35% to £2.8m (2012: £2.1m).

Autodesk is a leader in 3D design, engineering and entertainment software. It has customers across the manufacturing, architecture, building, construction, and media and entertainment industries—including the last 17 Academy Award winners for Best Visual Effects.

The statement said the Delcam directors, who have been so advised by Numis, considered the terms of the offer to be fair and reasonable and have said it is their intention to recommend to a general meeting of shareholders that the offer be accepted.

Autodesk Development has also received irrevocable undertakings from Delcam Trustees Ltd and Renishaw plc to vote in favour of the scheme at the meeting.

The US firm, chaired by Crawford W. Beverage, has also received letters of intent from J O Hambro Capital Management Ltd and Herald Investment Management Ltd confirming their intention to vote in favour of the scheme.

Clive Martell, Chief Executive Officer of Delcam said: “I am very excited by the opportunities from combining Delcam with Autodesk to create a compelling platform from which to service both companies’ manufacturing clients.

“The offer is at a level which recognises the potential of Delcam and provides an attractive opportunity for Delcam shareholders to realise value for their current holdings in cash, while at the same time opening up new opportunities for our staff and partners operating within the wider platform of the Autodesk Group.”

Citi is acting as financial adviser to Autodesk and Autodesk Development.  

Carl Bass, President and Chief Executive Officer of Autodesk added: “Today we are taking an important step on our path towards delivering a better manufacturing experience. Together Autodesk and Delcam will help further the development and implementation of technology for digital manufacturing.”