Siemens to buy U.S. software firm Brightly in $1.58 billion deal By Reuters

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© Reuters. FILE PHOTO: German industrial conglomerate Siemens CEO Roland Busch attends the virtual annual shareholders’ meeting in Munich, Germany February 10, 2022. Sven Hoppe/Pool via REUTERS

By John Revil

ZURICH (Reuters) – Siemens is buying U.S. technology company Brightly Software from private equity owner Clearlake Capital for $1.58 billion, the German engineering group said on Monday, its latest move to expand its software credentials and grow faster than its competitors.

Siemens Smart Infrastructure, which offers digital systems to manage the security and energy consumption of buildings, acquires Brightly to expand its offer in the field of “software as a service” (SAAS).

North Carolina-based Brightly makes cloud-based software that collects data from sensors installed in buildings and analyzes when maintenance will be needed before a problem occurs.

“Today’s acquisition reinforces our growth objectives, particularly for digital revenue and software as a service,” Siemens Chief Executive Roland Busch said in a statement.

SAAS increases Siemens’ access to small and midsize customers by making the software a subscription rather than a purchase.

Clearlake bought Brightly, whose products are used in schools, hospitals, offices and factories, for around $500 million in 2019.

Brightly expects 2022 revenue of around $180 million and operates in a market with an annual growth rate of 13%, Siemens said.

Matthias Rebellius, managing director of Smart Infrastructure and Siemens board member, said Brightly’s maintenance asset management software complements Siemens’ existing building management software offering.

“An owner of a property portfolio wants to optimize their operating expenses and ensure the asset is more valuable if and when they sell it,” he told Reuters. “This can reduce downtime and generate significant savings.”

The deal will improve Smart Infrastructure’s profitability, with Brightly’s current margins above the division’s mid-term target of 11-16%.

Siemens said the deal, which is expected to close by the end of 2022, will be accretive to earnings per share in the second year after closing.

The acquisition is part of Siemens’ ambition to grow faster than rivals like France’s Schneider Electric (EPA:) and Alstom (EPA:) as well as General Electric (NYSE:) by combining its core engineering business with digital expertise.

Siemens would continue to target small transactions to drive smart infrastructure, Rebellius said.

Siemens said last year it wanted to break into additional markets worth 120 billion euros, with software as a service seen as a key part of the strategy.

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