In a big move that represents Siemens second largest acquisition, the German-based company has acquired Altair Engineering Inc., a major producer of simulation and analysis software.

Altair shareholders will receive $113 per share, representing an enterprise value of approximately $10.6 billion. With this acquisition Siemens strengthens its position in industrial software, rounding out its currently robust industrial software portfolio.

The acquisition comes at a time when Altair reported a $1.8 net profit in the third quarter of 2024, up from its net loss of $4.4 million a year earlier.

A forward move toward sustainability and AI

Siemens pointed to both digital transformation and sustainability as key reasons for the move. “This strategic investment aligns with our commitment to accelerate the digital and sustainability transformations of our customers by combining the real and digital worlds,” said Roland Busch, president and CEO of Siemens.

The company’s interest in AI is part of Siemens’ rationale for the move. “The addition of Altair’s capabilities in simulation, high performance computing, data science, and artificial intelligence together with Siemens Xcelerator will create the world's most complete AI-powered design and simulation portfolio,” said Busch. “It is a logical next step: we have been building our leadership in industrial software for the last 15 years, most recently, democratizing the benefits of data and AI for entire industries.”

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According to Siemens, the addition of Altair’s simulation portfolio will strengthen the company’s mechanical and electromagnetic capabilities. Siemens sees this as a way to enhance and build out a comprehensive digital twin with the goal of delivering a full-suite, physics-based, simulation portfolio as part of Siemens Xcelerator.

Altair's data science and AI-powered simulation capabilities allow anyone, from engineers to generalists, to access simulation expertise to decrease time-to-market and accelerate design iterations. Additionally, Altair's data science capabilities will unlock Siemens' industrial domain expertise in product lifecycle and manufacturing processes.

Nearly 40 years of software development

For Altair, the acquisition follows decades of growth in the software market. “This acquisition represents the culmination of nearly 40 years in which Altair has grown from a startup in Detroit to a world-class software and technology company,” said James Scapa, Altair’s founder and CEO. “We have added thousands of customers globally in manufacturing, life sciences, energy and financial services, and built an amazing workforce, and innovative culture.”

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Scapa sees the acquisition as the next step to broaden Altair’s offering to the market. “We believe this combination of two strongly complementary leaders in the engineering software space brings together Altair’s broad portfolio in simulation, data science, and HPC with Siemens’ strong position in mechanical and EDA design,” said Scapa.

In a separate move during the same week, Siemens announced that it will sell its Airport Logistics Unit to Toyota Industries Corporation’s Vanderlande for $326 million.