Keysight Advances Software-Centric Solutions Leadership Through the Acquisition of ESI Group

• Expands Keysight’s application layer portfolio with simulation capabilities that are critical to accelerate innovation in multiple end markets including automotive
• Enables customers to accelerate time to market and lower operational costs, while reducing their environmental footprint
• Increases Keysight’s software revenue and ARR

Keysight Technologies, Inc. (NYSE: KEYS) announced its intention to acquire the entire share capital of ESI Group SA (Euronext Paris Symbol: ESI) (“ESI Group”) at a price per share of 155 euros in cash. The acquisition values ESI Group’s entire share capital at 913 million euros on a fully diluted basis. Founded in 1973, ESI Group is a leading innovator of virtual prototyping solutions in automotive and aerospace end markets.

ESI Group’s sophisticated software solutions simulate a product’s behavior during testing and real-life use. The company’s portfolio is highly differentiated, with predictive simulation technology for the most challenging system designs. ESI Group’s real-time digital twin solutions combine model-driven simulation with data-driven test to create virtual simulations, and its immersive industrial solutions enable workflow automation and virtual manufacturing.

In today’s era of digital transformation, product development across many industries is shifting left in the design cycle and becoming virtualized. Computer-aided engineering supports this shift left with virtual prototyping of products, manufacturing processes, and workflows.

By bringing ESI Group into its electronic design and test portfolio, Keysight will further expand its software prototyping capabilities into computer-aided engineering, enabling customers to accelerate time to market and lower operational costs, while reducing their environmental footprint.

Satish Dhanasekaran, President and Chief Executive Officer of Keysight, said:

“Keysight’s acquisition of ESI Group accelerates our strategy of providing software-centric solutions with virtual prototyping and advanced simulation capabilities. Keysight and ESI Group share rich cultures of innovation and strong commitments to solving customers’ most complex challenges, which will enable value creation for all stakeholders. The Keysight team looks forward to working with the world-class talent at ESI Group to unlock opportunities and drive our combined success.”

Cristel de Rouvray, Chief Executive Officer of ESI Group, said:

“I am delighted for ESI to announce this significant milestone today with Keysight. Over the past four years, our entire team has been dedicated to transforming ESI Group into a leading actor in the industrial software and simulation sectors. This combination with Keysight is a testament to the success of the work carried out over the years and will enable ESI to enter a new phase of its development. The core values, vision, and ambition that have driven Keysight over its long and reputable history and under its current leadership are perfectly aligned with those of ESI Group: pioneers enabling innovation for industry. I trust this operation is the promise of an exciting and sustainable future.”

Transaction Structure

On June 28, 2023, Keysight made a binding offer to certain shareholders of ESI Group to acquire a controlling block of the ESI Group’s share capital and voting rights.

Once completed, Keysight will file a proposed mandatory tender offer for the remaining outstanding shares of ESI Group. If legal conditions are met at the end of the offer, a squeeze-out procedure will occur, and the ESI Group will be delisted from Euronext Paris.

Completion of the acquisition of the controlling block of ESI shares is expected to take place during the fourth quarter of calendar year 2023, with the tender offer to occur shortly thereafter.

A presentation to supplement today's announcement can be found on Keysight's Investor Relations website under “News, Events, Presentations”.

J.P. Morgan Securities LLC is acting as exclusive financial advisor to Keysight with Paul Hastings LLP acting as legal advisor.

About ESI Group

Founded in 1973, ESI Group envisions a world where Industry commits to bold outcomes, addressing high stakes concerns - environmental impact, safety and comfort for consumers and workers, and adaptable and sustainable business models. ESI Group provides reliable and customized solutions anchored on predictive physics modeling and virtual prototyping expertise to allow industries to make the right decisions at the right time while managing their complexity. Acting principally in automotive & land transportation, aerospace, and heavy industry, ESI Group is present in more than 15 countries, employs 1,000 people around the world, and reported 2022 sales of 130 million euros. ESI is headquartered in France and is listed in compartment B of Euronext Paris.

About Keysight

At Keysight (NYSE: KEYS), we inspire and empower innovators to bring world-changing technologies to life. As an S&P 500 company, we're delivering market-leading design, emulation, and test solutions to help engineers develop and deploy faster, with less risk, throughout the entire product lifecycle. We're a global innovation partner enabling customers in communications, industrial automation, aerospace and defense, automotive, semiconductor, and general electronics markets to accelerate innovation to connect and secure the world. Learn more at Keysight Newsroom and www.keysight.com.

Source: IR-KEYS

View source version on businesswire.com: https://www.businesswire.com/news/home/20230628746222/en/