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By February 17, 2016 Read More →

Siemens to acquire engineering simulation specialist CD-Adapco

$970 million buys one of the largest remaining independent CAE firms.

Siemens has announced it will acquire engineering simulation specialist CD-Adapco for $970 million. The deal is expected to close in the next two months.

Motorcycle and rider aerodynamics simulation with CD-Adapco STAR-CCM+ showing the aerodynamic penalty from having the rider exposed to the airflow. (Source: CD-Adapco)

Motorcycle and rider aerodynamics simulation with CD-Adapco STAR-CCM+ showing the aerodynamic penalty from having the rider exposed to the airflow. (Source: CD-Adapco)

CD-Adapco is a Melville, New York-based engineering simulation company with a global clientele and annual revenue close to $200 million in 2015. Its software solutions cover a wide range of engineering disciplines including Fluid Dynamics (CFD), Solid Mechanics (CSM), heat transfer, particle dynamics, reactant flow, electrochemistry, acoustics, and rheology.

On average, CD-Adapco increased its revenue at constant currencies by more than 12% annually over the past three fiscal years. Siemens says it expects the business to continue to experience strong growth in the future.

CD-Adapco has over 900 employees; Siemens says revenue in 2015 achieved software-typical double digit margins. Revenue per employee was approximately $222,000, also a software industry average for profitable companies.  

High angle of attack re-entry simulation of the NASA X-34 with adaptive meshing for off-body shock capture, created by CD-Adapco STAR-CCM+. (Source: CD-Adapco, courtesy of TLG Aerospace)

High angle of attack re-entry simulation of the NASA X-34 with adaptive meshing for off-body shock capture, created by CD-Adapco STAR-CCM+. (Source: CD-Adapco, courtesy of TLG Aerospace)

Siemens says it is acquiring CD-adapco as part of its Vision 2020 plan to expand its portfolio in the area of industry software. CD-Adapco will be integrated into the PLM software business of Siemens’ Digital Factory (DF) Division, which also is the business unit of Siemens PLM Solutions.

What do we think?

All the major CAD vendors own simulation and analysis software; this is the biggest CAE acquisition in many years. Simulation and analysis are moving from niche tools used by analysis experts to mainstream product engineering design. The affordability of high performance computing has made it possible for simulation to become part of the design workflow, saving manufacturers money by testing alternatives sooner.  

If this triggers a new round of consolidation in the field, only one company (Ansys) is probably not going to be a target because of its size. MSC Software would probably welcome a suitor. Altair is approximately the same size as CD-Adapco.  

 

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Posted in: BIZ, News Watch

About the Author:

Randall S. Newton is the former Managing Editor of GraphicSpeak. He has been writing about engineering and design technologies for more than 25 years.

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