M&A: Schneider Electric Acquiring Bentley Systems? Potential Industrial Software Implications Explained

Schneider Electric may acquire Bentley Systems, an engineering software firm, for roughly $15 billion -- though there's no guarantee a deal will occur.

Chatter about the potential dial first surfaced in The Wall Street Journal. Schneider Electric later confirmed that it was exploring a potential deal. Bentley Systems declined to comment about the M&A chatter.

The potential business combination -- involving Schneider Electric's Aveva business and the overall Bentley Systems company -- could help partners and customers to design and manage more sustainable infrastructure worldwide.

Indeed, key growth opportunities include cloud-based digital twin software -- which allows users to create virtual models of physical infrastructure to model and optimize their environmental and energy impact.

Schneider Electric and Aveva Business Backgrounds

Schneider Electric, founded in 1836, is based in Paris, France. Annual revenue was €36 billion (US$38.4 billion) in fiscal year 2023, a 13% organic growth rate from fiscal year 2022.

Schneider Electric, led by CEO Peter Herweck, positions itself as the "digital partner for sustainability and efficiency" for "homes, buildings, data centers, infrastructure and industries." The company's expertise spans energy technologies, real-time automation, software, consulting services and managed services.

What is Aveva Software? Take a closer look, and Schneider Electric owns Aveva -- an industrial software business focused on the energy, infrastructure and manufacturing sectors. Among Aveva's near-term goals: Develop and launch a sustainability innovation program for customers. The Bentley Systems business, if acquired, would merge into Aveva, multiple reports say.

Bentley Systems: Infrastructure Software Business Background

Bentley Systems, founded in 1984, is based in London, United Kingdom. The company develops infrastructure engineering software. Annual revenue was $1.23 billion in 2023, up 11.8% from 2022. Earnings for Q1 2024 are expected on May 7.

Customers and partners leverage Bentley's software to for the "design, construction, and operations of roads and bridges, rail and transit, water and wastewater, public works and utilities, buildings and campuses, mining, and industrial facilities," the company says. Much of Aveva's positioning describes how customers can leverage the company to design and manage more sustainable infrastructure.

CEO Transition: Several weeks before the M&A speculation started, Bentley Systems announced a CEO transition plan. Indeed, Chief Operating Officer Nicholas Cumins is scheduled to succeed Greg Bentley as CEO on July 1, 2024.

Partner programs: The Bentley Systems partner program spans channel partners, train ing partners and China service partners. The Aveva partner program spans Select-level partners, plus distributors, solutions providers, systems integrators, technology and alliance partners, and parent Schneider Electric.

Mergers and Acquisitions: Familiar Territory

Schneider Electric has expansive M&A expertise. For instance, the company acquired a climate consulting and net-zero solutions business from global IT services firm Atos Group in 2023.