Schneider and Aveva restart deal talks
Schneider Electric, the French industrials group, is in renewed talks to acquire a majority stake in Aveva, the UK engineering software developer, as it makes another attempt to strike a deal with a potential value of around £2bn.
Two people close to the process said the companies have resumed discussions after their previously agreed deal collapsed in late December last year. One of the people added that the talks were advanced and agreement could be reached within weeks. But both people cautioned that there was no certainty that the discussions would lead to a deal.
Schneider Electric and Aveva declined to comment.
Their latest talks are said to concern a similar deal structure to the one they first announced in July last year, which was in effect a reverse takeover of Aveva by Schneider.
Under that proposed deal, which was terminated by mutual consent, Aveva would have swapped a majority stake in the combined business for Schneider’s industrial software unit, Schneider Software. The terms of the failed deal also included a £550m “control premium” to be paid to Aveva shareholders, equivalent to around 850p per share.
But, after six months of due diligence, Aveva said in December that “significant integration challenges were identified that could not be overcome without considerable additional risk and cost”.
On Monday, shares in Aveva rose out of negative territory and were trading 7 per cent higher, at £18.10, just after midday — with all the gains following the Financial Times’ first report of the talks. Schneider Electric shares were 1.3 per cent lower at €54.41, giving the company a market value of €32.1bn.
Schneider’s proposed combination with Aveva would follow its acquisition of another UK engineering IT group: Invensys. It bought the company in 2013 in a cash-and-share deal worth £3.4bn.