Rockwell Automation to make $1B equity investment in PTC
PTC (PTC) and Rockwell Automation (ROK) announced that they have entered into a definitive agreement for a strategic partnership that is expected to accelerate growth for both companies and enable them to be the partner of choice for customers around the world who want to transform their physical operations with digital technology.
As part of the partnership, Rockwell Automation will make a $1B equity investment in PTC, and Rockwell Automation’s Chairman and CEO, Blake Moret, will join PTC’s board of directors effective with the closing of the equity transaction.
Under the terms of the agreement relating to the equity investment, Rockwell Automation will make a $1 billion equity investment in PTC by acquiring 10,582,010 newly issued shares at a price of $94.50, representing an approximate 8.4% ownership interest in PTC based on PTC’s current outstanding shares pro forma for the share issuance to Rockwell Automation.
The price per share represents an 8.6% premium to PTC’s closing stock price on June 8, 2018, the last trading day prior to today’s announcement.
Rockwell Automation intends to fund the investment through a combination of cash on hand and commercial paper borrowings.
Rockwell Automation will account for its ownership interest in PTC as an Available for Sale security, reported at fair value.
As separately announced today, Rockwell Automation is increasing its share repurchase target for fiscal year 2018 to $1.5 billion.
This represents a $300 million increase to its previous plans to repurchase $1.2 billion of its stock in fiscal year 2018.
The investment transaction is subject to customary closing conditions and regulatory approvals, and is expected to close within 60 days.
PTC Inc. develops and delivers software products and solutions worldwide.
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