NEW DELHI : ITC Infotech India Ltd has agreed to buy part of the product lifecycle management (PLM) business of US software and services company PTC and create its own PLM unit, called DxP Services.
As part of their expansion plan, the two companies also agreed to drive customer digital transformation initiatives, focused on adopting PTC’s Windchill PLM software as a service (SaaS), ITC Infotech reported Friday. .
The value of the acquisition was not disclosed. A person familiar with the development said ITC Infotech was paying around $130-150 million for the company. The payment is made in two installments – the first will be paid in this financial year and the rest the following year.
The deal has been ongoing since last October, the person said on condition of anonymity.
ITC Infotech, whose turnover is approximately ₹3,000 crore, can add $100-120 million with PTC purchase, this person said. “The idea is to reach around $500 million in revenue and go for a listing after that,” the person said.
Parent company ITC Ltd has considered listing its infotech arm, Mint reported earlier. With cash on ITC’s books, acquisitions are a convenient way to expand the information technology unit’s business.
The newly created entity will combine PLM professional services experts from both companies into a single team dedicated to creating and delivering the tools and methodologies needed to accelerate a smooth transition to SaaS, the statement added.
“Together with ITC Infotech, we are creating a dedicated team to unlock the potential of our Windchill Services business and accelerate manufacturers’ ability to realize the benefits of SaaS, such as accessibility, security and lower total cost of ownership. lower,” said Jim Heppelmann, president and CEO of PTC. “PTC’s long-standing strategy has been to create a partner ecosystem that leverages the expertise and capability of systems integrators to drive business transformation and technology adoption across the entire global clientele.”
He added that this new agreement with ITC Infotech will allow PTC to realign its professional services experts with a unique thought leadership role in the industry.
The transaction is expected to close during PTC’s third fiscal quarter. PTC’s fiscal year ends September 30.
Management plans to discuss the expected impact of the agreement on PTC’s financial and operating metrics during its fiscal second quarter quarterly earnings conference call on April 27, according to the release.
ITC Infotech provides technology solutions and services to companies in the healthcare, manufacturing, consumer goods, banking and financial services, travel and hospitality industries.