Latest SaaS space consolidation gives Trimble a stronger European presence as it looks to compete with Oracle, Autodesk, Bentley (and others) in the construction collaboration sector.
US-based Trimble announced yesterday (23 April 2018) that it is to acquire privately-held Portland, Oregon-based construction ERP and SaaS collaboration vendor Viewpoint from Bain Capital in an all-cash transaction valued at US$1.2 billion.
This latest deal represents further consolidation in the construction collaboration sector, bringing the Newcastle, UK-based SaaS specialist formerly known as 4Projects (acquired by Viewpoint in February 2013) under the wing of an even bigger US firm.
The deal also comes just over two months after Trimble acquired Florida-based SaaS vendor e-Builder for US$500m. This latest deal also matches in value what Oracle paid for Melbourne, Australia-based SaaS construction collaboration vendor Aconex; the US$1.2bn deal was agreed by shareholders last month (March 2018), having been announced in December 2017. The deal will yield a handsome return for Bain Capital who invested around US$230 million in Viewpoint Construction Software in April 2014.
Trimble says Viewpoint is “highly complementary to Trimble’s e-Builder business, and will extend Trimble’s ability to provide more complete and integrated project, jobsite and business workflows across the construction lifecycle.”
This deal also represents the latest step by Trimble to grow its SaaS construction collaboration capabilities – a process it started in 2006 when it bought US-based Meridian; it then acquired Google’s SketchUp in 2012, and, in September 2014, acquired Gehry Technologies’ GTeam platform, subsequently relaunched as Trimble Connect (October 2014). And it launched a mobile-oriented platform, Trimble ProjectSight, in December 2014 (this may be one area for rationalisation: Viewpoint has also invested heavily in its mobile capabilities following the 2014 acquisition of MCS Priority1 – now Field View).
Viewpoint solutions are currently used in the management of construction projects worth over US$400 billion, and the company has around 8,000 customers worldwide. As a US-based business, Viewpoint is popular among many Engineering News-Record (ENR) 400 and 600 top tier construction firms in north America (complementing its V6 ERP platform, it acquired US-based estimating vendor Maxwell Systems in 2014), while the firm also extended its ERP operations into Australia (acquiring Jobpac in 2015), while also expanding in the UK and mainland Europe following the 4Projects acquisition. Viewpoint’s EMEA operations have seen strong revenue growth in recent years – 48% in 2015, 30% in 2016 , while commercial director Steve Spark told me in October that the 2016 momentum looked to have continued into 2017.
Trimble says the acquisition will round out its “comprehensive construction technology portfolio” and “position Trimble to further its strategy to lead the industry’s transformation.” It continues:
“With Viewpoint, Trimble will be able to offer customers a central workflow platform for delivering integrated, end-to-end construction management, while further enabling connectivity across the complete construction lifecycle. In addition, Viewpoint will complement Trimble’s recent acquisition of e-Builder, a leading SaaS-based construction program management solution for capital program owners and program management firms. Viewpoint will further extend these capabilities with focus on general, specialty and heavy civil contractors, and link project data into the owner-facing e-Builder suite for end-to-end project transparency.”
Steven W. Berglund, president and CEO of Trimble, says:
“The Viewpoint acquisition, in combination with the recent e-Builder acquisition, confirms Trimble leadership in the accelerating digital transformation of the construction industry. The acquisitions are strategically significant and position us to play a unique and central market role in providing comprehensive enterprise and project solutions. They also provide significant financial opportunity and contribute strong growth trajectories. The current trajectories can be further enhanced by a large addressable market enabled by the combined capabilities of the three companies.”
Manolis Kotzabasakis, CEO of Viewpoint, says:
“The construction industry is embarking on a major digital transformation, and together with Trimble we will further accelerate technology innovation and adoption to deliver even more value to our customers. This partnership is a perfect fit, as Trimble and Viewpoint share a common vision helping construction companies integrate operations across the office, team and field, improving project profitability, enhancing productivity, and effectively collaborating across the construction ecosystem.”
The transaction is expected to be completed in the third quarter of 2018, subject to regulatory approvals and other customary closing conditions. The all-cash purchase price of $1.2 billion is expected to be funded through a combination of cash on hand and new indebtedness.
Trimble expects Viewpoint to contribute approximately US$200 million of non-GAAP revenue in 2019 with operating cash flow of greater than US$50 million and non-GAAP operating margin exceeding 20 percent.
The Viewpoint business will be reported as part of Trimble’s Buildings and Infrastructure Segment.