Tech solutions company PTC acquires IoT startup ThingWorx

Technology solutions company, PTC (Nasdaq: PTC) today announced it had acquired ThingWorx, creators of an award-winning platform for building and running applications for the Internet of Things (IoT), for approximately US$112 million, plus a possible earn-out of up to US $18 million. The acquisition of ThingWorx positions PTC as a major player in the emerging IoT era.

thingworxlogoThe ThingWorx acquisition extends PTC’s strategy by accelerating its ability to support manufacturers seeking competitive advantage as they create and service smart, connected products. As part of PTC, ThingWorx will continue to help customers in a wide range of industries seeking to leverage the IoT, including telecommunications, utilities, medical devices, agriculture, and transportation, as well as an emerging partner network of IoT-enabled service providers.

PTC is expected to use the ThingWorx platform to speed the creation of high value IoT applications that support manufacturers’ service strategies, such as predictive maintenance and system monitoring, in complement to PTC’s existing service lifecycle management (SLM) and extended product lifecycle management (PLM) solution portfolio. With ThingWorx, PTC will also now offer its customers a means to establish a secure, reliable connection to their products as well as a platform to rapidly develop applications for maintaining and operating them – and ultimately for finding ways to create new value from them.

Commenting on the buyout, PTC President and CEO Jim Heppelmann, said, “For manufacturers today, it is clear to us that improved service strategies and service delivery is the near-term ‘killer app’ for the Internet of Things and this opportunity has guided our strategy for some time. With this acquisition, PTC now possesses an innovation platform that will allow us to accelerate how we help our customers capitalize on the market opportunity that the IoT presents.”

As part of PTC, ThingWorx intends to continue serving this diverse market with senior management continuing to focus on its current path. “At ThingWorx, we share PTC’s vision for helping organizations fundamentally leverage the connected world,” said Russell Fadel, CEO and co-founder, ThingWorx. “We believe all industries, but especially manufacturing, will be transformed in the Internet of Things era.”

The acquisition is expected to add more than US $10 million of revenue over the next 12 months, with $5 million to $7 million of revenue in FY’14. As a result of cost synergies and investment plans for ThingWorx, PTC still expects FY’14 non-GAAP EPS of $2.00 to $2.10. PTC drew $110 million from its credit facility to finance the transaction.

Image/video credit: PTC & ThingWorx

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