Dassault to buy Matrix One for $408 million

PLM and 3D firm Dassault Systemes' acquisition of PLM company Matrix One for about $408 million has been approved by directors and is expected to go ahead in the second quarter of this year.

PLM and 3D firm Dassault Systemes is to buy PLM company Matrix One for $7.25 per share in cash, representing a total of about $408 million.

The proposed acquisition, which has been approved by directors at both companies, is expected to be completed by the end of the second quarter, subject to customary closing conditions, including approvals by Matrix One's shareholders and regulatory authorities.

Matrix One provides collaborative PLM software and services to medium-to-large organisations including companies across the high tech, consumer products and medical devices industries.

More than 850 companies, representing hundreds of thousands of users, work with Matrix One's products, including industry leaders such as Alcatel, Celestica, Gap, General Electric, IBM, Intel, Johnson and Johnson, Nokia, Philips, Procter and Gamble, Qualcomm, Sony Ericsson, STMicroelectronics and Toshiba.

Matrix One has 488 employees and 26 offices in North America, Europe and Asia Pacific.

For its most recent fiscal year up to 2nd July 2005, Matrix One reported total revenues of $124.1 million.

Cash and cash equivalents totaled $98.6 million at 31st December 2005.

Bernard Charles, Dassault's President and Chief Executive Officer, said: "The acquisition of Matrix One will extend our reach, enabling us to bring the value of PLM to a significantly expanded audience across a broader range of industries".

"The combination will enable a new level of collaboration and will leverage the best-in-class technologies, products and skills of both companies".

"From all perspectives this combination is very complementary and will result, following the closing, in an excellent fit that should provide significant benefits to our combined customers, partners and employees".

"We are therefore clearly committed to enhancing further Matrix One, Enovia and Smarteam products to serve the broad range of customers' demands".

"I believe we will be well positioned to offer customers the most advanced vision and most comprehensive offering in the market".

"Our combined product portfolio will address a wide spectrum of product development requirements for companies across many industries".

"And, from a collaboration perspective, our combined portfolio will provide offerings for teams, for the extended enterprise and for multi-enterprise integration".

Mark O'Connell, Matrix One President and CEO, said: "On behalf of all Matrix One employees, we are excited to join Dassault and believe the combination will leverage the unique value both companies bring to the market".

Thibault de Tersant, Dassault's Executive VP and CFO, said: "From a financial perspective, the acquisition is expected to have a neutral impact on our non-GAAP EPS in 2006 and is expected to be accretive to our non-GAAP EPS in 2007".

"We anticipate a one percentage point negative impact on our 2006 and 2007 non-GAAP operating margin, with no further impact anticipated after 2007".

"We are confident that, working together, we can accelerate the pace of Matrix One's growth at both the top line and bottom line".

Dassault estimates that the deferred revenue write-down, as part of purchase accounting adjustments, may approximate $20 million for the first 12 months following the completion of the proposed acquisition of Matrix One.

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