Sandvik Just bought CNC Software/Mastercam

[crazy^millman]

https://www.home.sandvik/en/news-and-media/newslist/news/2021/08/sandvik-to-acquire-leading-cam-software-company-cnc-software-inc.-creators-of-mastercam/">Read all about it

Sandvik has signed an agreement to acquire US-based CNC Software Inc., a leading provider of CAD/CAM software solutions for manufacturing industries and the company behind Mastercam, the most widely used Computer Aided Manufacturing (CAM) brand in the industry. CNC Software will be reported in the Design & Planning Automation division within Sandvik Manufacturing and Machining Solutions.

By acquiring CNC Software, Sandvik gains a world-class CAM brand in the Mastercam software suite with an installed base of around 270,000 licenses/users, the largest in the industry, as well as a strong market reseller network and well-established partnerships with leading machine makers and tooling companies.

"This is in line with our strategic focus to grow in the digital manufacturing space, with special attention on industrial software close to component manufacturing. The acquisition of CNC Software and the Mastercam portfolio, in combination with our existing offerings and extensive manufacturing capabilities, will make Sandvik a leader in the overall CAM market measured in installed base. CAM plays a vital role in the digital manufacturing process, enabling new and innovative solutions in automated design for manufacturing," says Stefan Widing, President and CEO of Sandvik.

[JParis]

I can't say I'm surprised but I'm stunned...

WOW!!!

[Here's Johnny!]

Maybe some of the BUGS....(hidden features) will get fixed!

[gcode]

I'm thinking this is really bad news  

[Here's Johnny!]

I'm thinking this is really bad news  

Maybe it will be an improvement...time will tell.

[gcode]

Purchase price was not disclosed

30 million kroners is about $3.4 million

Interesting data on Mastercam revenue in the press release

CNC Software is an independent, family-owned company founded in 1983, headquartered in Tolland, Connecticut, USA, with 220 employees. The revenue for 2020 totaled USD 60 million with an EBIT margin of 25-30 percent, and of which the share of recurring revenue was approximately 60 percent. CNC Software has had a historical annual growth rate of approximately 10 percent and is expected to outperform the estimated market growth of 7 percent.

The underlying EBITA margin is accretive to Sandvik Manufacturing and Machining Solutions. However, the first year after closing date, revenues will be impacted by deferred revenue accounting adjustments, and the EBITA margin will be slightly dilutive to Sandvik Manufacturing and Machining Solutions. Impact on earnings per share will initially be slightly negative.

Transaction costs are to be accounted for in the third quarter 2021 and estimated to SEK 25 million.

The parties have agreed not to disclose the purchase price. The deal is expected to close during Q4 2021, subject to customary regulatory approvals. In conjunction with the closing, Sandvik will make a write-down of overlapping assets representing SEK 30 million.

[Here's Johnny!]

3.4Mill seems cheap IF the numbers are correct? If you are making 25-30% (EBITA) on 60Mill and annual growth of 10%.

[Jim at Gentex]

The parties have agreed not to disclose the purchase price.

Yeah I'd be willing to bet there will be more than a few 'early retirements' in Tolland as a result of this deal.
But hey, it's their company and they are free to do with it what they wish.

Time will definitely tell whether we the customers will be better off, worse off, or stay relatively the same.  

[JParis]

[quote="Jim at Gentex" post_id=14858 time=1629902483 user_id=83]

The parties have agreed not to disclose the purchase price.

Yeah I'd be willing to bet there will be more than a few 'early retirements' in Tolland as a result of this deal.
But hey, it's their company and they are free to do with it what they wish.

Time will definitely tell whether we the customers will be better off, worse off, or stay relatively the same.  
[/quote]

I'm hearing there was somewhat of a "blood letting" over there yesterday

[Jeff]

Called it!---sort of

[JParis]

Called it!---sort of

Tom and I have been discussing this off and on for 10-12 years now...even still, I'm not surprised it happened but I am still stunned it actually happened.

[gcode]

I'm hearing there was somewhat of a "blood letting" over there yesterday

This will be hard on the dealer network too IMO
The web, Zoom and the cloud have made big changes in how software is marketed and supported

[JParis]

I'm hearing there was somewhat of a "blood letting" over there yesterday

This will be hard on the dealer network too IMO
The web, Zoom and the cloud have made big changes in how software is marketed and supported

I tend to agree...I think the first will be a consolidation of markets & territories.
I'll not be surprised to see smaller and those that serve in overlapping territories dropped.

I'm happy I moved on from Cimquest years back...I'd not want to be there now.

[Jeff]

I'm hearing there was somewhat of a "blood letting" over there yesterday

What do you mean? Employees unhappy and quit? Or a mass firing?

[gcode]

I just posted this on the Mastercam forums
I'm curious to see if it survives

https://forum.mastercam.com/Topic43202.aspx?Update=1">https://forum.mastercam.com/Topic43202.aspx?Update=1