Earlier this week, ABB announced the impending acquisition of B&R, a supplier of factory automation solutions for machinery. With this acquisition, ABB closes a long-standing gap in its industrial solutions portfolio, which should increase its competitiveness with arch rival Siemens. The purchase price was not revealed, and the acquisition is expected to close during the summer 2017.
This acquisition “reshuffles the cards” in the worldwide automation market, and especially in the European market. Once completed, the combination of ABB’s strength in process automation and B&R’s innovation in factory automation will create the third largest automation supplier after Siemens and Schneider Electric with significant offerings across the spectrum of industries, from discrete to hybrid to heavy process.
By the Numbers
B&R had revenue of $600 million in 2016, and ABB turned over $6.5 billion in process automation alone, with another $6.4 billion coming from its discrete automation and motion business. The two companies did not disclose the purchase price, but a fair estimate based on common industry practices puts the price at roughly $2 billion.
ABB has set a mid-term revenue target of $1 billion with B&R products, an increase of 67 percent over B&R’s current revenue. This mid-term target only refers to the development of the current B&R offering. In addition to this, there are around $260 million that are part of the current ABB portfolio, which will add to it. This means ABB and B&R plan to continue the growth path and even accelerate.
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Keywords: ABB, B&R, Process Automation, Factory Automation, ARC Advisory Group.