Siemens has announced the acquisition of Supplyframe, the industry network for electronics design and manufacturing, with the closing of the transaction expected in the fourth quarter of the fiscal year 2021.
The acquisition unlocks several valuable opportunities for customers, as they are able to gain quick access to both Siemens’ offerings and Supplyframe’s marketplace intelligence; helping customers reduce costs, increase agility and make informed decisions.
With Supplyframe having created a strong Design-to-Source Intelligence (DSI) ecosystem with over 10 million engineering and supply chain professionals worldwide, this acquisition will certainly strengthen Siemens’ portfolio through Supplyframe’s Software as a Service (SaaS) offerings, not only in the field of Electronic Design Automation (EDA) and Printed Circuit Boards (PCB), but also in other domains and technology fields.
Cedrik Neike, a member of the Managing Board of Siemens AG, commented “We are very pleased to welcome Supplyframe’s highly innovative and talented team to the Siemens family. Supplyframe will be the nucleus to accelerate our overall digital marketplace strategy. Supplyframe’s ecosystem and marketplace intelligence complements our industrial software portfolio perfectly and strengthens our capabilities for the growing market of small- and mid-size customers.”
Steve Flagg, founder of Supplyframe, will continue as CEO of the company and will join the Siemens Digital Industries Software senior leadership team. He commented “Eighteen years ago, we set out on a journey to intelligently connect the extended electronics value chain. It took both a dedicated team and a visionary customer base to gradually turn our vision into reality. This process has been further accelerated by the recent component shortage environment, which has exposed the fragility of supply chains and created a mandate for digital transformation and intelligent decision making. I am thrilled to join forces with Siemens to scale our innovation and drive broader adoption of our DSI solutions globally. This is an amazing outcome for our customers, partners and employees.”
This acquisition is certainly good news for online properties in our industry. The purchase price was given as $700M, which is a huge multiple for a media business that turns over only 1/10th of this amount. Of course Supplyframe is not a conventional media business, and offers tools as well as content, but it still represents a large investment for what is currently a $70M annual turnover business.
We think this acquisition is an indication of a broader online strategy from Siemens. They are adding ecommerce capabilities, and clearly see online as an important part of their go-to-market strategy. If the acquisition of Supplyframe helps Siemens build an online presence that drives a significant proportion of their revenue, the price they’ve paid will seem like a bargain. As other companies build online strategies, we expect they will be looking for acquisitions to strengthen their technology, content and expertise, which could be good news for some other media properties.
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