PLANO, Texas -- A private equity group of Bain Capital, Silver Lake Partners and Warburg Pincus today announced it has reached a definitive agreement with EDS t o purchase UGS PLM Solutions, EDS product lifecycle management subsidiary, for $2.05 billion in cash. The transaction, in which each private equity firm i s an equal investor, represents the largest private equity investment ever made in a technology company. This agreement validates UGS PLM Solutions strategy and leadership, while positioning the company for continued growth, said Tony Affuso, pres ident and CEO of UGS PLM Solutions. Most importantly, the transaction furt her strengthens our industry-leading client care model. We are delighted to hav e the opportunity to partner with investors who have significant software experi ence and a growth-oriented long term approach to building value. UGS PLM Solutions is a global leader in PLM software and related services, with approximately 42,000 clients worldwide. In 2003, UGS PLM Solutions reported rev enue of US$897 million and net income of US$104 million.¹ In the second hal f of 2003, the business achieved 14 percent (8 percent in constant currency) yea r-over-year revenue growth. This transaction is part of the strategic plan we outlined last year to fo cus on our core information technology and business process outsourcing business es, said EDS Chief Financial Officer Bob Swan. The divestiture signi ficantly enhances our competitive position while strengthening our balance sheet . The transaction is expected to close within 90 days, pending customary closing c onditions.
Leadership In a Growing Market
UGS PLM Solutions delivers integrated technology and services supporting the ent ire lifecycle of a product -- from concept and development to distribution and d elivery. The global market for PLM software and services is expected to grow by a compound annual growth rate of 8 percent through 2008 to more than US$14.5 billion, according to CIMdata. "We are excited to partner with Silver Lake and Warburg Pincus to acquire the te chnology and market leader in the PLM business, and to support a talented team a s they further build what is already a successful global enterprise," said Andre w Balson, a Managing Director at Bain Capital. "UGS PLM Solutions has earned its leadership position by developing mission critical software and integrated serv ices for leading companies in design intensive industries. We are committed to investing to grow the business by continually increasing the value that the comp any’s technologies deliver to customers." "UGS PLM Solutions is the undisputed market share and technology leader in the r apidly expanding PLM industry. We like investing in proven winners and look for ward to working with CEO Tony Affuso to grow this outstanding software franchise ," said David Roux, founding principal of Silver Lake Partners. We look for these types of opportunities -- to invest in market leading bu sinesses that create sustainable value. And, from its established position of gl obal strength in the core design and engineering software market, UGS PLM Soluti ons is at the forefront of innovative software vendors that are creating real bu siness value, said Joseph P. Landy, co-president of Warburg Pincus. Through 2008, CIMdata expects the product data management and collaboration segm ent of the PLM market, which UGS PLM Solutions leads on the strength of its Team center portfolio, to grow 17 percent, compounded annually, to nearly US$5 billio n. When complete, the transaction will enable UGS PLM Solutions to operate op timally as an independent software company, Affuso said. We look for ward to working with our new investment partners and building on our momentum in the PLM space.
About Bain Capital (www. baincapital.com)
Bain Capital is a global private investment firm that manages several pools of c apital including private equity, venture capital, public equity and high-yield a nd mezzanine debt with more than $17 billion in assets under management. Since i ts inception in 1984, the firm has made private equity investments in over 225 c ompanies around the world, partnering with strong management teams to grow busin esses and create operating value. Bain Capital has deep experience in a variety of industries and a team of almost 200 professionals dedicated to investing in and supporting its portfolio companies. A global team of professionals focused on technology sectors has guided investments in nearly 75 software and technolog y companies, including DoubleClick, Ameritrade, Integrated Circuit Systems, Chip PAC, Therma-Wave, Recruitsoft, and USinternetworking. Headquartered in Boston, Bain Capital has offices in New York, London and Munich.
About Silver Lake Partners
Silver Lake is the leading private equity partnership focused exclusively on lar ge-scale investing in technology. Silver Lake seeks to achieve superior returns by investing with the strategic insight of an experienced industry participant, the operating skill of a world-class manager, and the financial expertise of a disciplined private equity investor. Specifically, Silver Lake’s mission is to function as a value-added partner to the management teams of the world’s leading technology franchises. Its portfolio companies include technology industry le aders such as Ameritrade, Business Objects, Flextronics, Gartner Group, MCI and Seagate Technology. For more information, please visit
About Warburg Pincus
Warburg Pincus has been a leading private equity investor since 1971. The firm c urrently has approximately $9 billion under management and $5 billion available for investment in a range of sectors including information and communication technology, business services, energy, financial serv ices and technologies, healthcare and life sciences, media and real estate. The firm has invested approximately $4.8 billion in 140 technology companies, includ ing BEA Systems (Nasdaq: BEAS), VERITAS Software (Nasdaq: VRTS), Avaya (NYSE: AV ) and Manugistics Group (Nasdaq: MANU). Warburg Pincus is an experienced partner to entrepreneurs seeking to create and build durable companies with sustainable value. The firm has an active portfolio of about 125 companies. For more inform ation, please visit
About UGS PLM Solutions
UGS PLM Solutions, a leader in product data management, collaboration and produc t design software and services with 42,000 clients and more than 2.8 million sea ts of technology operating in the market, is the product lifecycle management (P LM) subsidiary of EDS. The company works collaboratively with its clients to cr eate solutions enabling them to transform their process of innovation and thus b egin to capture the promise of PLM. The integration of the former operations of companies including Structural Dynamics Research Corporation (SDRC), Engineerin g Animation Inc. (EAI) and UGS, UGS PLM Solutions has created some of the leadin g design, collaboration and product data management technologies that ultimately formed the foundation of the PLM industry. Today, the company is a family of o ne, building on three decades of leadership in continuing to be a pioneer in PLM . For more information on UGS PLM Solutions products and services, visit
EDS, the worlds most experienced outsourcing services company, delivers su perior returns to clients through its cost-effective, high-value services model. EDS core portfolio comprises information-technology and business process outsourcing services, as well as information-technol ogy transformation services. EDS two complementary, subsidiary businesses are A.T. Kearney, one of the worlds leading high-value management consulta ncies, and UGS PLM Solutions, a leader in product data management, collaboration and product design software. With 2003 revenue of $21.5 billion, EDS is ranked 80th on the
. The companys stock is traded on the New Yo rk (NYSE: EDS) and London stock exchanges. ¹ UGS PLM Solutions 2003 revenue and net income at actual exchange ra tes.