Engineering software firm Altair explores sale, sources say

Altair Engineering

22/10/2024 16:06

By Anirban Sen and Milana Vinn
       NEW YORK, Oct 22 (Reuters) - Altair Engineering
 ALTR.O , an engineering software maker with a market value of
about $8 billion, is exploring a sale after receiving
acquisition interest, three people familiar with the matter said
on Tuesday. 
    Troy, Michigan-based Altair is working with investment
bankers to gauge interest from potential suitors, the sources
said, requesting anonymity as the discussions are confidential. 
    If the talks are successful, a deal could be signed in the
coming weeks, one of the sources said, cautioning that a
transaction is not guaranteed and Altair may choose to stay
independent. 
    Potential bidders include rival design software makers such
as Cadence Design Systems  CDNS.O , the sources said. Reuters
could not determine whether Cadence had approached Altair.
    Altair and Cadence did not immediately respond to requests
for comment. 
    The talks come at a time when engineering software companies
have become attractive acquisition targets, as investors bet on
companies that could benefit from the boom in artificial
intelligence. 
    In January, design software Synopsys  SNPS.O  agreed to buy
smaller rival Ansys in a deal worth about $35 billion. Earlier
this year, Bentley Systems  BSY.O , which competes with Altair,
held talks with Schneider Electric but a deal did not
materialize. 
    Founded in 1985, Altair makes a range of software solutions,
including what is referred to as computer-aided engineering
software that helps engineers design, analyze and manufacture
products. 
    Altair's stock has jumped about 55% over the past year and
the company currently trades at a higher multiple compared to
its peers. Altair trades at roughly 46 times earnings before
interest, taxes, depreciation and amortization (EBITDA),
compared to roughly 30 times for Bentley Systems  BSY.O ,
according to LSEG data. 
    In its most recent quarterly earnings, Altair posted an 8%
rise in software revenue to $135.4 million, which came in at the
higher end of its guidance. 
    Altair works with several large corporations including Ford
Motor  F.N  and International Paper  IP.N , according to its
website. 

 (Reporting by Anirban Sen and Milana Vinn in New York
Editing by Nick Zieminski)
 ((Anirban.Sen@thomsonreuters.com; Twitter: @asenjourno; Reuters
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