Source: REUTERS
By Anirban Sen and Milana Vinn
NEW YORK, Oct 22 (Reuters) – Altair Engineering ALTR.O, an engineering software maker with a market value of nearly $9 billion, is exploring a sale after receiving acquisition interest, three people familiar with the matter said on Tuesday.
Troy, Michigan-based Altair is working with investment bankers to gauge interest from potential suitors, the sources said, requesting anonymity as the discussions are confidential.
If the talks are successful, a deal could be signed in coming weeks, one of the sources said, cautioning that a transaction is not guaranteed and Altair may choose to stay independent.
Altair’s shares jumped more than 14% on Tuesday after Reuters reported on the company’s sale talks.
Potential bidders include rival design software makers such as PTC PTC.O and Cadence Design Systems CDNS.O, the sources said. Reuters could not determine whether PTC and Cadence have approached Altair.
Altair, PTC, and Cadence did not immediately respond to requests for comment.
Engineering software companies have become attractive acquisition targets as investors bet on companies that could benefit from the boom in artificial intelligence.
In January, design software Synopsys SNPS.Oagreed to buy smaller rival Ansys in a deal worth about $35 billion. Earlier this year, Bentley Systems BSY.O, which competes with Altair, held talks with Schneider Electric SCHN.PA but a deal did not materialize.
Founded in 1985, Altair makes a range of software solutions, including what is referred to as computer-aided engineering software that helps engineers design, analyze and manufacture products.
Altair’s stock has jumped about 55% over the past year and the company trades at a higher multiple compared to its peers. Altair trades at roughly 46 times earnings before interest, taxes, depreciation and amortization (EBITDA), compared to roughly 30 times for Bentley Systems BSY.O, according to LSEG data.
In its most recent quarterly earnings, Altair posted an 8% rise in software revenue to $135.4 million, at the higher end of its guidance.
Altair works with several large corporations including Ford Motor F.N and International Paper IP.N, according to its website.
(Reporting by Anirban Sen and Milana Vinn in New YorkEditing by Nick Zieminski)
