EDS is to sell its UGS PLM Solutions product design and data management software business to three private equity firms for $2.05 billion. UGS is the leading supplier of product lifecycle management (PLM) systems to the aerospace and defence industries. The cash sale to Bain Capital, Silver Lake Partners and Warburg Pincus is due to close within three months.
UGS has its origins in the McDonnell Douglas Unigraphics computer-aided design (CAD) business, acquired by EDS in 1991. The company's biggest customers are automotive giants Ford and General Motors, but Boeing is its third largest account. Lockheed Martin and its partners in the Joint Strike Fighter programme use UGS's Teamcenter PLM system to enable international collaborative design of the F-35.
Although Boeing has standardised on Dassault Systemes' Catia design software and Enovia PLM system for the 7E7, UGS says Teamcenter is used as the single source of data for all commercial aircraft from the Boeing 737 to the 777. "There are more sites running Catia where the data is managed by Teamcenter than Enovia," says marketing director Steve O'Lear. "We are not being squeezed out of the aerospace and defence market."
According to an independent report, UGS in 2002 had almost twice as much of the aerospace and defence PLM market as its nearest competitor, the company says. Teamcenter is designed to work with multiple CAD systems, and in January UGS won its largest-ever European contract, a $19 million deal with MTU Aero Engines to integrate existing Catia and Unigraphics systems, as well as SAP business software and Microsoft Office. "We unseated Dassault," says O'Lear. The company is now competing for a Rolls-Royce contract to implement an enterprise-wide PLM solution.
Plano, Texas-based EDS is selling UGS to focus on its core IT and outsourcing operations and achieve its goal of zero net debt by year end.
GRAHAM WARWICK / WASHINGTON DC
Source: Flight International
