M&A activity

M&A activity across the automation market in recent years has been very strong, driven both by corporates looking to widen their product offering and institutional investors wanting to gain a foothold in such a fast-growing sector.

Larger players are in a rush to acquire capabilities that can work across the dominant technologies of the smart, connected world – namely IT, electronics, robotics and process automation – and are prepared to pay healthy multiples to gain the IP and technological knowledge they require.

For the time being the market remains dominated by strategic acquirers, although financial investors are expected to enter the market in greater numbers once business models become more income-recurring.

For instance, instead of companies providing a fixed price automation ‘project’ solution – which can result in irregular cashflows – the model is likely to evolve into one where clients are charged on a recurring ‘pay as you use’ basis for the same solution.

Automation allows for this transformation as data capture and credibility is vastly improved, which in turn enables suppliers to understand future risk and how, therefore, to charge clients.

Meanwhile, in terms of deal activity the US continues to lead the way with a number of blockbuster deals. A good example was the acquisition by Honeywell International Inc, the technology and manufacturing company, of Intelligrated Inc, a provider of intelligent automated material handling solutions. The $1.5bn (c. €1.3bn) acquisition helps Honeywell leverage Intelligrated’s warehouse systems, order fulfilment technologies and software solutions, which complements Honeywell’s own scanning and mobility business.

Cross-border activity

The past 12 months has continued the trend of increasing cross-border activity.

For instance, Swiss engineering group ABB expanded its robotics and industrial automation portfolio by acquiring B&R, an independent Austrian provider with annual sales of over €500m. The deal allows ABB to offer the entire spectrum of technology and software solutions around measurement, control, actuation, robotics, digitalisation and electrification. B&R has a global customer base of more than 4,000 machine manufacturers, and offers automation software and solutions for customers in the machine and factory automation market segment.

Another deal saw the Midea Group, a China-based industrial products and services company, acquire KUKA AG, the German industrial automation company and world-leading manufacturer of industrial robots which has had a factory in China since 2013. The deal enables Midea, best known for its air conditioners and washing machines, to enhance its industrial robotics business and third party logistics services.

Omron Corporation, the listed Japan-based manufacturer and seller of electric components, industrial automation products and automotive electronics, acquired Delta Tau Data Systems Inc, the US-based manufacturer of motion controllers. The acquisition allows Omron to develop its engineering capabilities in the field of motion control, as well as deliver motion control solutions globally.

A landmark deal, which closed in early 2017, saw US carmaker Tesla acquire German company Grohmann, a specialist in building automated factories such as battery assembly lines for electric cars.

Recent deal activity

Target Country Description Acquirer EV (€m)
Machine Pages France High speed robotics and machines MBO n.a
Intelligrated, Inc. US Intelligent automated material handling solutions Honeywell International Inc. 1316
Dematic Group US Integrated automated technology, software and services Kion Group AG 2875
KUKA AG Germany Industrial automation company Midea Group Co., Ltd 3778
Svensk Industri-automation Sweden Supplier of robot automation cells for machine tending ABB n.a
JOT Automation Ltd Finland Automation equipment, systems and solutions for electronics industry Global Equipment Services and Manufacturing, Inc. n.a
System Logistics S.p.A Italy Manufacturer of automated material handling systems Krones AG n.a
The Paslin Company US Manufacturing and marketing industrial equipment and automation solutions Wanfeng Auto Holding Group Co Ltd n.a
NDC Automation Pty.Ltd Australia Manufacturer of automated vehicles for industry Dematic Group n.a
Retrotech Inc US Design, installation and support of automated material handling systems Kion Group AG 36.0
Bernecker + Rainer Industrie-Elektronik Ges.m.b.H. Austria Automation software and solutions ABB Ltd n.a
Maverick Technologies LLC US Industrial automation, enterprise integration Rockwell Automation, Inc n.a
Braas Company US Distribution of products and services for industrial automation and control Motion Industries, Inc. n.a
Grohmann Engineering GmbH Germany Production lines for industrial automation Tesla Motors Inc 99.0
NHL-Automation ApS Denmark Automation solutions primarily for wastewater treatment and water treatment Logimatic Holdings AS n.a
M&R Automation GmbH Germany Automation solutions in the field of assembly, measurement and testing technology PIA Automation Holding GmbH n.a