Schneider Electric to buy PTC for $22.6 billion in cash

Schneider Electric said Monday it agreed to buy PTC for $205 a share in cash, a deal the companies said values the Boston software maker’s equity at about $22.6 billion and implies an enterprise value of $23.7 billion. The price is a 42.3% premium to PTC’s last closing price before the announcement and 46.1% above its 30-trading-day volume-weighted average, according to their joint release. Reuters called it Schneider’s biggest deal ever.

Why Schneider wants PTC: PTC sells computer-aided design and product lifecycle management software that more than 30,000 customers use to design complex physical products and manage their engineering data. The French energy technology company says PTC adds “the critical product and engineering data fabric” to its existing process and energy data, which its pending purchase of Cognite, an industrial AI software maker, would add to. The release says the combination would build “a unified digital thread” and supply the “trusted context which AI agents need.”

“Together, we are creating the industry’s most complete Software & AI powerhouse and highest-quality portfolio bridging the physical and digital worlds,” Schneider CEO Olivier Blum said in the release. PTC CEO Neil Barua said, “Joining Schneider Electric is an incredible opportunity to elevate the scope and impact of what we deliver for our customers globally.”

Schneider puts PTC’s calendar 2025 revenue at €2.4 billion, excluding the ThingWorx and Kepware businesses, with an adjusted profit margin, before interest, taxes and amortization, of about 40%. It says the deal would roughly triple its addressable market in industrial software and lift software and services to about 24% of group revenue on a pro forma basis, including Cognite. It targets €250 million in annual cost savings by the third year and about €800 million in revenue synergies. The release does not mention data centers in its case for the deal; Reuters tied it to Schneider’s data center business, which supplies cooling units, server racks and power gear.

Why the shares moved: PTC shares jumped 34.4% in U.S. premarket trading Monday, while Schneider shares fell nearly 10% in early Paris trading as investors weighed the deal’s size, the premium and the outlook for software valuations, Reuters reported.

How it will be paid for: Schneider said the total cash consideration of about €22 billion is secured by a fully committed bridge facility from Morgan Stanley and Société Générale. It plans to fund the deal with about €5 billion to €6 billion of new shares through an accelerated bookbuild and €16 billion to €17 billion of new debt. PTC’s securities filing sizes the bridge loan at $25 billion and says the merger is not conditioned on financing. Schneider said it expects to keep its Category A credit ratings and to pause share buybacks in 2027 and 2028.

Who has a stake: PTC shareholders get the final say; holders of a majority of outstanding shares must approve the deal at a special meeting, and PTC’s board recommends a yes vote. PTC would owe Schneider a $700 million termination fee in some cases, including if it takes a better offer or its board drops its recommendation, the filing says. PTC, which has more than 7,000 employees, would join a Schneider software group with AVEVA and Cognite that reports to Blum, Barua told staff in a letter PTC filed with regulators. The letter also calls Schneider one of PTC’s largest customers.

What’s next: PTC plans to file a proxy statement ahead of the shareholder vote. The deal needs U.S. antitrust clearance under the Hart-Scott-Rodino Act, approval from the Committee on Foreign Investment in the United States and other antitrust and foreign investment clearances, according to the filing. Closing is anticipated by the third quarter of calendar 2027, PTC said. The merger agreement lets either side walk away if the deal has not closed by April 4, 2027, a date that extends automatically by up to nine months while regulatory reviews remain open. Schneider moved its third-quarter revenue report up to Oct. 16.

— Nico Valdez