SaaS Field Service Management Provider ServiceMax to be Acquired by PTC

By Craig Resnick

Category:
Acquisition or Partnership

PTC announced that it has signed a definitive agreement to acquire ServiceMax for approximately $1.46 billion in cash on a debt-free, cash-free basis from an entity majority owned by Silver Lake. ServiceMax is a Field Service Managementleader in cloud-native, product-centric field service management (FSM) software. The acquisition is expected to help strengthen PTC’s closed-loop product lifecycle management (PLM) offerings by extending the digital thread of product information into downstream enterprise asset management (EAM) and FSM capabilities. Subject to the satisfaction of regulatory approval and other applicable closing conditions, the transaction is expected to close in early January 2023.

Partners since 2015, PTC and ServiceMax both support manufacturers of complex, highly configured products for the medical device, industrial products, aerospace, and related verticals. These manufacturers view field service as a strategic part of their businesses to help maintain product performance, extend their products’ lifecycles, increase customer satisfaction, drive revenue growth, and expand profitability.

ServiceMax provides a comprehensive suite of cloud-native FSM capabilities built on the Salesforce platform. These capabilities include managing relevant information about serviced products, such as product description, serial number and service history, creating and managing work orders, and scheduling and dispatching technicians. ServiceMax’s FSM capabilities are also integrated with Salesforce’s customer relationship management (CRM) system, which helps to bridge a deeper understanding of the product as well as a deeper understanding of the customer.

ServiceMax’s FSM capabilities will help to complement PTC’s entire digital thread portfolio. For example, by remotely monitoring connected products with ThingWorx, customers could proactively detect service needs and automatically generate service orders in ServiceMax. Service technicians could leverage 2D work instructions from Arbortext or 3D AR work instructions created in Vuforia that are derived from the product’s digital product definition information created in Creo and managed in Windchill. Technicians could also leverage a more detailed understanding of service activities to help better optimize spare parts inventory with Servigistics.

Transaction Details

The purchase price will be funded in two stages, with $808 million paid at closing and $650 million paid in October 2023. The transaction will be funded with cash on hand, borrowings under PTC’s existing credit facility, and a new $500 million committed term loan.

ServiceMax is expected to generate approximately $160 million in ARR for PTC's Q2'23.

The transaction is expected to be accretive to PTC’s FY’23 cash flow from operations, free cash flow, and adjusted free cash flow targets.

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