Schneider Electric agrees to buy PTC for $22.6 billion in its biggest deal ever

According to the companies' announcement:

• Price: $205 per share in cash for all of PTC.
• Equity value: about $22.6 billion (€20.1 billion).
• Enterprise value: $23.7 billion (€21.1 billion), about 21 times PTC's expected 2027 adjusted earnings before interest, taxes and amortization.
• Premium: 42.3% over PTC's last closing price, and 46.1% over its 30-day volume-weighted average.
• Synergies: €250 million in annual cost savings by year three, plus about €800 million in expected revenue gains.

How it's paid for: about €5 billion to €6 billion in new Schneider shares and €16 billion to €17 billion in new debt, Reuters reports.

Timing: both boards approved the deal unanimously. It's expected to close by the third quarter of 2027, subject to approval from PTC shareholders and regulators.

PTC makes software that manufacturers use to design and manage complex physical products.

• CAD: computer-aided design software for engineering products.
• PLM: product lifecycle management, which tracks a product's data from first design to retirement.
• ALM and SLM: software for managing applications and servicing products.

PTC serves more than 30,000 customers worldwide, according to the announcement. It generated €2.4 billion in revenue in 2025 with an adjusted margin of about 40%, and expects revenue to grow about 10% a year through 2029.

Founded in 1985, PTC made its name in computer-aided design and lifecycle tools for industrial products, The Register notes.

The short version: design data. Schneider already sells software to help customers run their factories, power systems and buildings, including through Aveva, which it bought in 2023. PTC extends that "upstream" into product design and engineering.

Schneider says the combination creates "a leading, scaled, open and interoperable industrial software and AI franchise" covering the full lifecycle, from design and build to operate and maintain.

"As industrial AI moves beyond digital applications and is increasingly embedded in physical products and machines, processes and energy systems, new opportunities are emerging across the life cycle," Schneider said.

Feeding AI agents: PTC adds product and engineering data to the process and energy data Schneider already handles, according to the announcement. Schneider says that combination provides "the trusted context which AI agents need" to improve productivity, resiliency, efficiency and sustainability for customers.

A bigger market: Schneider says the deal roughly triples its addressable market in industrial software, including in discrete and hybrid manufacturing, and closes a gap in its product lifecycle software. It promises to keep an "open-by-design" approach across vendors and hardware.

Cross-selling: Schneider's global reach and energy expertise should open new markets for PTC, while PTC's tools give Schneider more to sell its existing customers, the companies say.

More software: the deal would lift software and services to an estimated 24% of Schneider's revenue, according to the announcement, with more than 15,000 software employees and more than 50,000 software customers.

"The acquisition of PTC represents an important step forward in our ambition to lead the new era of Energy and Industrial Intelligence," said Olivier Blum, Schneider's CEO. "By connecting and contextualizing data across the lifecycle of products and assets, we will create a unique digital thread for the next generation of Industrial AI."

On an investor call, Blum said that "data is becoming a very critical layer" for getting value from AI, Reuters reports. "At the design stage, it is super important that you can help your customer to design both product, machine, processes and energy system," he said, according to The Register.

"Joining Schneider Electric is an incredible opportunity to elevate the scope and impact of what we deliver for our customers globally," said Neil Barua, PTC's president and CEO.

A lot. Schneider, once known mainly for fuses and circuit breakers, now builds the backbone of data centers, supplying cooling units, server racks and power distribution equipment, Reuters reports.

Booming demand: Schneider's market value has more than doubled in four years as the AI boom drove demand for data center power and cooling, The Register notes. Data centers have moved from 40-kilowatt air-cooled racks to 250-kilowatt liquid-cooled systems that need much denser power and cooling, all working together.

A shopping spree: PTC is Schneider's third billion-dollar-plus deal this year, Gurufocus reports. In late 2024, Schneider paid about $850 million for a 75% stake in Motivair, a maker of liquid cooling gear, according to The Register. It also agreed to buy industrial data and AI company Cognite for $3.1 billion, a deal Reuters dates to June.

Blum suggested that owning PTC and Cognite will let Schneider build software-defined automation into power systems early in their design, with data centers among the first targets, The Register reports.

Not well, for Schneider.

• Schneider's shares fell nearly 10% in early Paris trading, wiping close to €15 billion off its market value, Reuters reports. Before Monday, they were up 29% this year.
• PTC's shares jumped 34.4% in US premarket trading.

The worries: investors weighed the size of the deal, the big premium and the outlook for software valuations amid AI-related uncertainty, according to Reuters.

"AI disruption fears are still weighing on software valuations, which allows acquiring PTC at a decade low valuation but could still weigh on Schneider post deal," analysts at Jefferies said in a note, as quoted by Reuters.

Berenberg analyst Nay Soe Naing told Reuters the price looked healthy given how compressed software valuations are right now.

Schneider's biggest ever: it tops Schneider's $11 billion purchase of Aveva in 2023, Gurufocus reports.

One of Europe's biggest: it's one of the largest deals in Europe this year, according to LSEG data cited by Reuters.

A heavyweight buyer: Schneider is France's third-most valuable listed company, worth about $196 billion, Silicon Republic reports, citing the Financial Times.

The deal needs approval from PTC shareholders and regulators. It isn't expected to close until the third quarter of 2027, giving plenty of time for regulatory scrutiny, The Register notes.

Schneider will report its third-quarter results on October 16. The company says it expects the deal to improve its revenue growth, share of recurring revenue, gross margin, adjusted profit margin and free cash flow conversion.

PTC, which has shifted toward recurring subscription revenue through its software-as-a-service offerings, had a market value of about $15.6 billion before the announcement, Gurufocus reports.

• PTC customers: the CAD and PLM tools you use will eventually sit inside Schneider's software portfolio, though little should change before the deal closes.
• Industrial AI watchers: expect more deals linking design data, factory data and energy systems as companies chase industrial AI.
• Investors: Schneider is taking on a lot of debt for this bet, and the market's first reaction was skeptical.