Siemens is acquiring Altair Engineering Inc., a Michigan-based 3D design and simulation software company, in a deal that is valued at around $10 billion. This is Siemens’ third-largest acquisition, which will help the organisation improve its position in industrial software and digital technology.

According to Siemens CEO Roland Busch, merging Altair’s AI and computational expertise with Siemens’ Xcelerator platform will create an AI-powered design and simulation portfolio, which will help further Siemens’ commitment to digital and sustainable transformations, blending physical and digital solutions.

Siemens expects the acquisition to increase its digital business revenue by 8%, adding about €600 million to the €7.3 billion it made in 2023. Altair shareholders will receive $113 per share, which is 19% more than the October 2024 share price.

Siemens expects $500 million in extra revenue in the medium term and over $1 billion in the long term. Cost savings are expected to boost EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortisation) by $150 million within two years. The acquisition will be funded from Siemens’ cash reserves and money from its recent sale of Innomotics.

The partnership will combine Siemen’s design skills with Altair’s simulation and data science, making the former’s Digital Twin technology better for detailed, physics-based simulations.

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While the acquisition is subjected to customary conditions, Siemens expects to close the transaction by the second half of 2025.