Schneider Electric SE · EURONEXT:SU
Schneider Electric — Merger or Acquisition (September 2017)
27 slides from Schneider Electric's merger presentation, Sep 5, 2017
Slide 1: Schneider Electric to combine its industrial software business with AVEVA
Schneider Electric to combine its industrial software business with AVEVA to create a global leader in engineering & industrial software September 5, 2017
Slide 2: Disclaimer
Disclaimer NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION This document contains statements about Schneider Electric and the proposed combination of Schneider El
Slide 3: Combination of Schneider Electric Software and AVEVA with strong value creation potential
Combination of Schneider Electric Software and AVEVA with strong value creation potential Creating a global leader in engineering With right structure to bring our Creating value for the Group and industrial software Industrial Software to next level • Creating a global leader with scale in • Leadin
Slide 4: Transaction overview
Transaction overview • Schneider Electric industrial software assets combined with AVEVA Proposed • Agreement signed, Publication of Prospectus this week and closing expected at or around 2017 transaction • Schneider Electric to own 60.0% of Enlarged Group • Schneider Electric will make a cash payme
Slide 5: Creating a global leader in engineering and industrial software with enlarged AVEVA
Creating a global leader in engineering and industrial software with enlarged AVEVA Schneider Electric – Investor Relations Page 5
Slide 6: We are answering the need for efficiency from capital intensive industries
We are answering the need for efficiency from capital intensive industries…. Capital investment constraints: need to maximize utilization and efficiency of existing assets Project phase 2-6 years (1/3 of project spend) Operations phase up to 50 years (2/3 of project spend) Process Design Plant Desig
Slide 7: Enhancing value chain coverage with closed-loop Digital Asset Lifecycle Management
… by enhancing our value chain coverage and thus providing comprehensive closed-loop Digital Asset Lifecycle Management and Unified Engineering Project phase 2-6 years (1/3 of project spend) Operations phase up to 50 years (2/3 of project spend) Plant Design Process Design Operate and Maintain Plant
Slide 8: Enhanced value to customers through Unified Engineering
Enhanced value to customers through Unified Engineering From (Today)… To Unified Engineering INEFFICIENCY Process Design Manual hand-over Modeling and Plant Design Manual artifact management Simulation Process Design Process Integrated engineering environment Modeling and Plant Design Collaboration
Slide 9: An end-to-end product portfolio with unmatched market and functional coverage
An end-to-end product portfolio with unmatched market and functional coverage Infrastructure and Discrete Batch/hybrid Process utilities Automotive, F&B, pharma, Oil & Gas, Power, water, aerospace CPG chemicals smart cities Plant engineering AVEVA PDMS, E3D, Engineering, AVEVA NET, Bocad, LFM Capita
Slide 10: Creating a leader in industrial software with scale and balanced global coverage
We are creating a leader in industrial software with scale, strong value proposition in Process/ Hybrid and balanced global coverage THE MOST COMPLETE PORFOLIO IN PROCESS/ HYBRID A BALANCED COVERAGE (Management & Analysts estimates for peers) (Enlarged AVEVA, proforma as of March 2017) Competitor 1
Slide 11: Customer Example: Unified Engineering: KBR
Customer Example: Unified Engineering: KBR would eliminate costly inefficiencies before they become reality Current Use Unified Engineering Potential Conceptual and Basic Engineering SimSci Pro/II SimSci DYNSIM Basic Engineeing Design Verification Integrated Process Design and Simulation 3D Plant De
Slide 12: Creating value for the Group
Creating value for the Group Schneider Electric – Investor Relations Page 12
Slide 13: The transaction enhances our industrial IoT value proposition and EcoStruxure offer
The transaction enhances our industrial IoT value proposition and EcoStruxure offer for industrial and infrastructure customers Unmatched End-to-End portfolio in Process and Hybrid • Process Control in the digital loop grow process automation • Enhance asset management grow services • Enhance gl
Slide 14: AVEVA reinforces our software capabilities and brings complementary coverage
AVEVA also reinforces our software capabilities and brings complementary end market and geographical coverage STRONG SOFTWARE COMPLEMENTARY GEOGRAPHIC CAPABILITIES FROM AVEVA AND END-MARKET COVERAGE SCHNEIDER ELECTRIC AVEVA 1 INDUSTRIAL SOFTWARE 1 ~650 R&D employees and >50 global locations LatAm Ro
Slide 15: Tailored transaction structure and strong value creation
Tailored transaction structure and strong value creation Schneider Electric – Investor Relations Page 15
Slide 16: Tailored deal structure creates a dedicated platform to accelerate growth
Tailored deal structure creates a dedicated platform to accelerate growth…. DEAL STRUCTURE CREATING THE RIGHT PLATFORM FOR GROWTH Existing AVEVA Hardware agnostic, software company “DNA”, shareholders bespoke organisation and focus mindset Ability to invest in talents and incentivize in Special divi
Slide 17: Contributing Group industrial software assets broadly in line with AVEVA multiple
Contributing Group industrial software assets broadly in line with AVEVA multiple Contribution of Schneider’s Industrial Software assets at relevant multiples > Schneider Electric1 trading on c.12.3x LTM adjusted EBITA multiple > Industrial Software assets contributed at c.19x adjusted EBITA FY2017
Slide 18: Combined entity with accretive margin consolidated in Schneider Electric accounts
Combined entity with accretive margin to be consolidated fully in Schneider Electric accounts at closing Unaudited combined entity Pro-forma FY2017 income statement Schneider Electric Year to March 31 AVEVA Group Software Business** Pro forma (£ million) FY 2017 FY 2017 FY 2017* Revenue 215.8 441.7
Slide 19: Right structure to succeed
Right structure to succeed Schneider Electric 60% ownership and voting rights in enlarged Majority ownership AVEVA 2-year standstill period Majority of the Board independent (5 members out of 9) Balanced & Independent Existing Non-Executive Directors of AVEVA (incl. Chairman) to remain Board
Slide 20: Strong synergy potential for value creation
Strong synergy potential for value creation SELECTED DRIVERS > End to end product portfolio covering full customer needs Material > Complementary of customers and segments revenue > Geographical complementarity synergies > Enhance Schneider Electric’s Industrial IOT platform EcoStruxure value propos
Slide 21: No change of our capital allocation priorities
No change of our capital allocation priorities > c. 50% payout ratio with progressive dividend No change of our capital > c. €1.0bn share buyback till June 2019 allocation priorities > Value-accretive M&A Schneider Electric – Investor Relations Page 21
Slide 22: Next steps with indicative timeline towards closing
Next steps with indicative timeline towards closing Draft - TBU INDICATIVE TIMELINE FOR THE TRANSACTION September 6, 2017 Prospectus published September 29, 2017 AVEVA Extraordinary General Meeting At or Around end 2017 Closing expected after regulatory approvals obtained Schneider Electric – In
Slide 23: Appendices
Appendices Schneider Electric – Investor Relations Page 23
Slide 24: Definitions
Definitions Draft - TBU Software and industry terms Financial abbreviations • FEED: Front End Engineering Design • Adjusted EBITA: Earnings before Interest and • EAM: Enterprise Asset Management Amortisation of intangible assets (excluding other software), share-based payments, gain/loss on fair • E
Slide 25: Product Descriptions: Schneider Software
Product Descriptions: Schneider Software Draft - TBU • Ampla: Operations management software designed primarily for the metals, mining and minerals industry to optimise production process performance and energy usage. • Avantis®:Asset management software used to ensure the reliable operation of prod
Slide 26: Product Descriptions: AVEVA Group
Product Descriptions: AVEVA Group Draft - TBU • AVEVA BOCAD™: Structural detailing software for efficient steelwork design and fabrication. • AVEVA Engage™: Ultra-High Definition whole model visualisation with instant, touch-controlled access to contextually filtered information, to enable collabora
Slide 27: Life Is On | Schneider Electric
Lifels On | Schneider GeElectric
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