ABB Ltd. (ABB) is all set to expand its enterprise software business with the acquisition of Mincom, a Brisbane, Australia-based provider of software solution. The acquisition is being made from Francisco Partners, a private equity group, investing in technology businesses for an undisclosed amount. The closing of the deal is subjected to regulatory clearances.
The acquisition will expand ABB’s portfolio of software products and build a leadership position for the company in enterprise asset management (EAM) software and services. ABB’s position will be boosted by Mincom’s knowledge and experience in a wide range of industries and a complete set of offering for enterprise asset management (EAM) software and services.
Annual revenue generation of Mincom is about $200 million with an employee strength of 1,000 and a distribution network in 19 countries. Mincom is a leading provider of software solutions As in the Asia-Pacific and Latin America regions, serving 17 of the top 20 customers in global mining groups and also businesses in the energy sector, defense and other asset-intensive industries.
ABB will retain Mincom’s management team and operations which will be added to its software business, Ventyx. This will help ABB to serve the existing customer base of Mincom. Mincom’s strong position in the natural resources sector complements ABB’s expertise in mining control systems and its leading position in energy management technology.
Business in the emerging markets are seen as prime benefactors for the company though rising demand levels in mature market also supports ABB’s future growth prospects. Price increases initiated by the company to meet the rising raw material costs will lead to margin improvement. ABB focuses on attaining profitable growth opportunities by maintaining a competitive cost position, strong balance sheet, strong presence in global market and a leading technology.
ABB Ltd.’s power and automation technologies offer a solution for sustainable development, thus helping to shield the world's resources. The company has a number of technologies for the solar power industry and also a growing installed base. ABB Ltd. has witnessed improving signs in late-cycle power, with some recent large contracts.
However, ABB's results are likely to be adversely affected by macroeconomic weakness as more than 80% of the company's orders are derived from outside the US. A major competitor of ABB Ltd. is Siemens AG (SI).
ABB Ltd. is a Zurich (Switzerland) based power and automation technology company. The company operates in approximately 100 countries, structuring its global organization into five regions: Europe, Americas, Asia, the Middle East and Africa.
We maintain a Zacks #2 Rank (short-term Buy recommendation) on ABB Ltd.
ABB LTD-ADR (ABB): Free Stock Analysis Report
Be the first to comment