NEEDHAM, MA – PTC (Nasdaq: PMTC), the Product Development Company (TM), today announced it has signed a definitive agreement to acquire Mathsoft Engineering & Education, Inc. (Mathsoft) for $63.25 million in cash. Mathsoft is the provider of Mathcad(R), software that helps engineering calculations critical to the product development process, as well as other mathematics-driven processes. With annual revenue of approximately $20 million and over 250,000 professional users worldwide, Mathcad is the industry standard for authoring and documenting engineering calculations in industries such as discrete and process manufacturing, architecture, engineering and construction, government and education. With this acquisition, PTC will expand its computer-aided design, manufacturing and engineering (CAD/CAM/CAE) solutions with unique predictive engineering capabilities that will help customers deliver optimized products sooner, with higher quality and improved knowledge capture. The acquisition, which is subject to regulatory approval and other customary closing conditions, is expected to close in early May.
“Mathsoft will be an important addition to PTC, as it will expand both our product offering and our addressable market,” said C. Richard Harrison, president and chief executive officer of PTC. “CAE is one of the faster-growing segments of the product lifecycle management market. PTC is staking out a unique position within this market segment by arming engineers with tools used upfront in the engineering process. This approach delivers greater value to customers because it helps optimize the entire engineering process.”
Mathsoft’s approach to CAE, which helps predict engineering parameters before design begins, will enable customers to optimize designs and will complement PTC’s existing structural, thermal, fatigue and mechanism analysis solutions used to validate Pro/ENGINEER(R) designs.
“Calculations are at the heart of engineering, driving critical decisions that determine competitive advantage,” said Chris Randles, chairman, president and chief executive officer of Mathsoft. “Today, many organizations still perform and manage engineering calculation work by hand, on calculators, in spreadsheets, or with programming languages. These outdated methods put critical intellectual property at risk, limit information reuse and can create confusion. With Mathsoft solutions, engineering organizations are documenting their engineering work as they go, creating, capturing and sharing critical calculations to leverage and enhance engineering and product development processes.”
Computer-aided design solutions are excellent for documenting design geometry, but without an understanding of the underlying calculations that drive critical parameters, they do not completely capture engineering intent. By complementing and extending PTC solutions with those from Mathsoft, PTC will be the first company to address this customer challenge to improve product quality, knowledge reuse and traceability of engineering calculations and turn them into corporate assets. This is particularly important for organizations with development processes that are complex, global, highly regulated, or those whose critical calculation knowledge base resides solely with individual engineers.
PTC and Mathsoft share over 900 customers. Vetco International, a leading supplier of products and services to the upstream oil and gas industry, uses solutions from PTC and Mathsoft to help bring innovative products to market. “In the upstream oil and gas business, delivering products with a strong focus on quality and reliability is of the utmost importance,” said Paul Krueger, vice president and chief information officer of Vetco International. “We use both Pro/ENGINEER and Mathcad to help us design and develop these products. One of the key benefits of this acquisition will be the integration of Mathcad into the PTC suite of products, as it will help us further optimize and improve key engineering processes across our product lifecycle.”
Once the acquisition closes, customers will continue to be able to leverage Mathcad as a stand-alone solution, or as an integral part of PTC’s Product Development System. Calculations authored and documented in Mathcad can predict critical parameters that will drive Pro/ENGINEER designs. Similarly, Pro/ENGINEER parameters can be fed into Mathcad to perform supplementary engineering calculations. Designs driven with Mathcad can then be validated using Pro/ENGINEER Mechanica(R) or other CAE applications. Additionally, institutional knowledge captured in XML-based Mathcad documents can be managed, cross-referenced, configuration controlled and reused via Windchill(R). Finally, technical documents become richer and deliver greater value when calculations, text and images are assembled and published dynamically with Arbortext.
“The powerful combination of Mathsoft and PTC solutions will significantly reduce the number of iterations and physical prototypes necessary to achieve product confidence, and also will improve an organization’s ability to capture and reuse information for a variety of downstream uses,” said Jim Heppelmann, executive vice president and chief product officer of PTC. “PTC is also dedicated to supporting Mathsoft customers in industries outside of PTC’s traditional customer base by delivering the value from Mathsoft solutions necessary for their continued success. PTC has a proven track record of working with multiple vendors to support system openness and heterogeneity to benefit our customers.”
“Mathcad is a strategic engineering design and analysis tool for us,” said Andre Pavlov, assistant state structural design engineer for the Florida Department of Transportation. “We are delighted to see that Mathsoft’s market leadership has been recognized by such a large and well-known leader in engineering design and development software. We expect that the combination of Mathsoft’s ingenuity and PTC’s strength and scale will benefit users of Mathcad in all areas of engineering.”
Based in Cambridge, Massachusetts, Mathsoft has 130 employees in seven countries including the United States, United Kingdom, Germany and Japan. In addition, Mathcad is sold and supported in more than 50 countries through the Mathsoft international distributor network. The transaction has been approved by the requisite vote of Mathsoft shareholders, including its largest investor, Edison Venture Fund.
PTC will discuss this acquisition on its second quarter financial results conference call on Wednesday, April 26, 2006 at 10:00 a.m. ET. The webcast will be available on the Company’s web site at www.ptc.com/for/investors.htm. To access the live call, please dial 888-566-8560 (in the U.S.) or +1-517-623-4768 (international). Please use passcode PTC. A replay of the call will be available until 5:00 p.m. ET on May 1, 2006. To access the replay via webcast, please visit www.ptc.com/for/investors.htm. To access the replay by phone, please dial 203-369-1121. Accompanying presentation materials will be available at PTC’s website at www.ptc.com/for/investors.htm.
About Mathsoft Engineering & Education, Inc.
Mathsoft Engineering & Education, Inc. pioneered calculation management solutions that protect engineering innovation, investments and intellectual capital while improving organizational efficiency and productivity. Mathsoft software is the internationally recognized standard for technical calculations and applied mathematics. Ninety percent of Fortune 1000 companies, 500 government agencies and 2,000 colleges and universities around the world use Mathsoft to capture the strategic value in their engineering calculations. More information on Cambridge, Mass.-based Mathsoft is available at www.mathsoft.com.
PTC provides leading product lifecycle management (PLM), content management and dynamic publishing solutions to more than 40,000 companies worldwide. PTC customers include the world’s most innovative companies in manufacturing, publishing, services, government and life sciences industries. PTC is included in the S&P 500 and Russell 2000 indices. For more information on PTC, please visit http://www.ptc.com.
Statements in this press release that are not historic facts, including statements about expanding PTC’s addressable markets through the acquisition of Mathsoft, the future integration and support of PTC and Mathsoft products and growth in the CAE market, are forward looking statements that involve risks and uncertainties that could cause actual results to differ materially from those projected. Those risks and uncertainties include the following: PTC’s acquisition of Mathsoft remains subject to regulatory approval and other customary closing conditions and there is a risk that the transaction may not be completed; we may be unable to successfully develop the technology necessary to integrate Mathsoft’s Mathcad product with PTC products; the market for, and customer adoption of, calculation solutions may not grow as quickly as we expect; we may be unable to retain and maintain relationships with key employees, distributors, customers and other strategic partners of Mathsoft, including those within markets and vertical industries with which PTC has little experience; we may be unable to adequately support multiple solutions acquired through strategic business development initiatives in industries outside of PTC’s traditional customer base as well as other risks and uncertainties detailed from time to time in reports filed by PTC with the Securities and Exchange Commission, including PTC’s most recent reports on Form 10-K and 10-Q.
PTC and its logo, The Product Development Company, Pro/ENGINEER, Windchill, Arbortext, and all PTC product names and logos are trademarks or registered trademarks of Parametric Technology Corporation or its subsidiaries in the United States and in other countries. Mathsoft and Mathcad are registered trademarks of Mathsoft Engineering & Education, Inc.