Mergers and Acquisitions Measure Industry Health

Mergers and Acquisitions Measure Industry Health

Here is a little bit of merger and acquisition activity of interest. One involving industrial cybersecurity; the other IT-oriented. Owl Cyber Defense and Tresys are coming together. I have been anticipating some consolidation in that space. Lots of startups. Can’t be that much business. In the other Dell Technologies appears to be rationalizing its organizational and investing complexity.

Tresys and Owl Cyber Defense to merge

Tresys Technology was recently acquired by DC Capital Partners, a private equity firm, and placed in a common holding company with Owl Cyber Defense. “The intention is to merge the two companies in the coming months, creating what we believe is the number one boundary security product and services company in the world. To both of us, nothing makes more strategic sense than this combination, and with DC Capital’s support we will be exploring additional strategic acquisitions to broaden our investment in innovation, geographies, and vertical markets. While we will continue to operate as separate businesses in the short term, over the coming months we will work on merging all operations and we will keep you fully apprised of those changes.”

Further from the message I received, “What does this mean for you? Both companies are fully committed to customer service excellence. You will continue to have access to our industry leading expertise in technology services and support; to help you select, configure, customize, maintain, and accredit solutions for any network separation issue. With our new ownership, there is a commitment to grow our international presence and resources, while markedly increasing the investment in R&D and integration services. You can expect to see an acceleration in the development and availability of new technologies, with deeper absorption of specific business use cases.”

The current plan with our investors is for Robert Stalick, CEO of Tresys, to lead the merged company. Michael Timan, CEO of Owl Cyber Defense, will continue to actively work alongside Bob in developing the vision, applying diligent process focus, and maintaining the sales and services engagement excellence for which we strive. “Our shared goal is nothing less than defining the future of network boundary security technology for the coming decades.”

VMware To Acquire all outstanding shares of Pivotal

I saw this story on Launch Ticker newsletter from CNBC.

Pivotal Software surges after VMware says it’s in talks to acquire the company.

Highlights:

  • VMware contributed to the formation of Pivotal in 2013.
  • Pivotal stock has fallen 66% in the past year.

Pivotal shares rose as much as 72% premarket Thursday August 15 after VMware said Wednesday it’s proceeding with an agreement to acquire all outstanding shares of Pivotal’s class A stock at $15 per share in cash, an 80.7% premium on Pivotal’s $8.30 closing price.

VMware also said in a regulatory filing that it has requested that Dell exchange all outstanding shares of Pivotal’s class B stock, other than class B Pivotal shares owned by VMware, for Class A VMware stock. Dell controlled almost 81% of VMware’s outstanding common stock and more than 97% of the combined voting power of VMware’s outstanding stock as of May 3. Dell and Pivotal are negotiating an exchange ratio for the shares.

The transaction could contribute to the further diversification of VMware, which has moved to collaborate with cloud infrastructure providers like Amazon in order to enable existing customers to run their computing workloads in whatever environment they like.

Shares of Pivotal have declined 66% in the past year. On June 5 Pivotal stock declined 41% after the company issued guidance that was below what analysts were expecting.

Pivotal went public in April 2018. VMware and DellEMC both contributed assets when Pivotal was established in 2013.

As a result of an agreement with Dell, VMware is the selling agent for certain Pivotal products, such that VMware collects cash that is then remitted to Pivotal, net of a contractual agency fee. As of May 3, VMware had a 16% financial interest in Pivotal and a 24% voting interest in the company.

In a statement of its own, Pivotal said on Wednesday that although it is in talks with VMware about a “potential business combination,” an agreement has not been made.

ABB Names Another CEO–Björn Rosengren Assumes Leadership in 2020

ABB Names Another CEO–Björn Rosengren Assumes Leadership in 2020

Senior leadership among leading automation companies has been regularly shifting during the past few years. ABB, Emerson Automation, GE Digital, Honeywell Process, Rockwell Automation have all experienced changes. Sometimes a few.

ABB’s board evidently didn’t like the direction former GE executive Joe Hogan was taking the company and looked closer to home to bring in Ulrich Spiesshofer. He accomplished some massive restructuring, but apparently his results did not match the expectations of the board, so he was replaced by Board Chair Peter Voser.

In today’s announcement, the Board of ABB has unanimously appointed Björn Rosengren, as Chief Executive Officer. He will join ABB on February 1, 2020 and succeed CEO, Peter Voser, in this role on March 1, 2020. At that time Peter Voser will revert to his position at ABB solely as Chairman of the Board.

Björn Rosengren (60), a Swedish citizen, is a highly experienced, international executive and leader of industrial businesses. He has been the CEO of Sandvik, a high-tech global engineering group, since 2015. During this time, he has overseen the successful implementation of a decentralized structure and improved both the profitability and financial strength of Sandvik. Prior to that, he was CEO of Wärtsilä Corporation, which manufactures and services power sources and other equipment for the marine and energy markets (2011-2015) and spent some thirteen years (1998-2011) in a variety of management roles at Atlas Copco, a world leading provider of sustainable productivity solutions.

“The Board is pleased that Björn Rosengren will be taking the lead at ABB, bringing with him a proven track record of value creation and exactly the managerial skills ABB needs during the next stage of its transformation,” said ABB Chairman and current CEO, Peter Voser. “After undertaking a thorough search, the Board is convinced that Björn Rosengren is the best candidate for the role. He understands how to establish successful decentralized organizations, empower people and demonstrates the culture of cooperation and high performance. Together with our strong management team, he will drive ABB’s strategy and deliver long-term value to all our stakeholders.”

CEO-designate, Björn Rosengren, said: “I am honored to have the opportunity to join ABB, a truly global technology leader, after I have completed my current commitments. At such a pivotal time for manufacturing industries, ABB must continue to best serve the needs of global customers with a unique technology and digital solutions portfolio to help enhance their productivity. I look forward to working with my new colleagues around the globe to enhance value through the delivery of the group strategy and fully empowering our businesses and people.”

ABB Names Another CEO–Björn Rosengren Assumes Leadership in 2020

OSIsoft Appoints New Senior Management

Short take: OSIsoft appoints Michael Siemer President and Wolfgang Kuchen Senior Vice President of Sales and Marketing revamping the senior management ranks.

OSIsoft, a leader in data technology for critical operations, recently announced these new appointments. I had thought that the transition from founder Pat Kennedy to his daughter running the operations was well under way. But Kennedy took on some VC investments a couple of years ago [https://themanufacturingconnection.com/2017/06/osisoft-announces-softbank-investment-fund-internet-things-infrastructure-growth/]and I’m betting that the investors were looking for experienced leadership to grow their investment.

Siemer, an energy industry veteran with extensive experience in leveraging software technologies to transform complex industrial operations, comes to OSIsoft from Devon Energy Corporation, a North American oil exploration and production company, where he served as Vice President of Engineering, Exploration and Production, Data and Analytics. Siemer led many enterprise-wide digital transformation efforts at Devon, including initiatives around field automation, data management, advanced analytics, decision support and strategic innovation. Prior to Devon, Siemer worked at SandRidge Energy, a startup E&P energy company, and prior to SandRidge he was employed for 18 years with 3M/Imation.

Kuchen, meanwhile, brings more than 20 years of experience providing financial, strategic and operational leadership in challenging business environments. Most recently, he served as President of Allergy Research Group (ARG), a Kikkoman portfolio company in the healthcare professional market. Prior to ARG, he was responsible for the growth and acquisition strategy at Soho Flordis International, a global healthcare company based in Australia.

Both Siemer and Kuchen will also serve on OSIsoft’s newly formed Executive Committee. Siemer will officially begin on September 1, 2019 while Kuchen will begin on August 1, 2019.

“Customer satisfaction has always been one of our most important principles at OSIsoft so we are very excited to bring in executives like Michael and Wolfgang who have experience in the type of digital transformation initiatives that many of our customers are starting to implement,” said Dr. J. Patrick Kennedy, CEO and founder of OSIsoft. “They will play a pivotal role in our growth as we enter a new decade.”

39 Years of Digital Transformation

Founded in 1980, OSIsoft has consistently been focused on software that lets people collect, understand and use data from critical operations, i.e. data generated by the production lines, safety equipment, power grids, and other systems that are at the foundation of their success. OSIsoft’s PI Systems acts as a data infrastructure, enabling individuals from across an organization to quickly obtain real-time insights into operations to save costs, increase productivity, develop new products or extend their capital investments.

OSIsoft customers have used PI System technology to predict wind turbine failures, increase output at a mine site by $120 million, reduce the power consumption of a supercomputer center at a national laboratory, deliver water services to millions of new customers in a major metropolitan city, boost the fuel efficiency of cruise ships and improve the quality and consistency of beer, among other accomplishments.

Over 1,000 leading utilities, 80% of the world’s largest oil and gas companies and 65% of the industrial companies in the Fortune 500 rely the PI System in their operations. Worldwide, over 2 billion sensor-based data streams are managed by the PI System.

“It is an honor to join OSIsoft. The company has long been recognized as a leader in industrial innovation and a critical partner for improving the performance of real-time operations,” Siemer said. “OSIsoft has earned an admirable level of trust with its customer base through technology-leading software and a genuine and consistent emphasis on service and support. My own experiences as a customer of OSIsoft are a big part of why I’m here. I look forward to working with the team and expanding upon the success they’ve achieved.”

“Data is the foundation of digital transformation and OSIsoft’s PI System is the gold standard for turning system data into an asset that people can use to make better decisions, improve their competitiveness and get the most out of their operations,” said Kuchen. “The impact of the PI System is set to expand rapidly.”

ABB Names Another CEO–Björn Rosengren Assumes Leadership in 2020

TÜV Rheinland Launches Customized Services in North America

Last November I visited TÜV Rheinland where we were briefed on its progress on cybersecurity services. It is a well known testing and service agency in Europe with the same reputation in general as UL in the US. I once served on a UL Industry Advisory Group for one of its standards where I got a good view of the value of testing and certification as a value to companies as well as consumers.

TÜV Rheinland has announced expanded Customized Services coverage to North America, now making these services available worldwide. Featuring its Supply Chain Audit, TÜV Rheinland’s customized services enable companies to demonstrate they are good corporate citizens by showing transparency and responsibility regarding their business practices and employees, while reducing risk, increasing brand value and providing a competitive advantage in the market.

TÜV Rheinland has been delivering Supply Chain Audit Services across the globe for many years, and is bringing these services to North America now as Corporate Social Responsibility (CSR) has become a more important part of companies’ business strategy. Increasingly consumers are holding brands accountable for not only how they create and deliver a safe product, but also for employee conditions and overall impact on the environment. With expanded supply chains, growing international production and trade connections, supply chain audits are a critical tool for ensuring compliance on a wide range of points including labor, safety, environment, social and ethics.

“Customers have countless options for procuring their goods. And especially when a customer enters a business relationship with a company that has a global supply chain, it is hard to ensure that the products are of high quality and have been manufactured under fair working conditions,” explained Frank Dorssers, Global Field Manager for Customized Services at TÜV Rheinland. “In these instances, supply chain or social audits create transparency and compel suppliers to disclose critical information, creating trust between the business, their partners and the customer.”

Audits vary in scope based on the sector and company, but often assess a company’s responsible sourcing practices across the supply chain and analyse compliance with Labor Laws, Environmental Sustainability, Business Ethics, as well as Health & Safety Management Systems. Specific risks by industry may also be addressed, such as hazardous chemical management in the printing and dyeing industry. Audit results provide actionable insights that companies can undertake to ensure their business practices meet the CSR and HSE (Health, Safety, Environment) goals they have set for themselves as well as mandates.

Industrial Internet of Things Maturity Assessment Explorer

Industrial Internet of Things Maturity Assessment Explorer

I’ve been off for most of the past week celebrating Independence Day and family birthdays. For those of you in the US, I hope you had a restful time off and enjoyed some fireworks displays. And now, back to what’s happening in the industrial world.

The Industrial Internet of Things (IIoT) comprises far more than just the simple connecting of devices back to a database in a server. It’s integral to digitalization. Applying abundance thinking to the system, clearly IIoT plays a key role for successful business transformation.

The Industrial Internet Consortium (IIC) has produced the IIoT Maturity Assessment, a web-based tool included in the IIC Resource Hub that enables users to better understand their enterprise IIoT maturity. The IIoT Maturity Assessment helps organizations become best-practice adopters of IIoT by guiding business managers through a range of questions about the adoption, usage and governance of IIoT within their organizations.

“The IIoT market has grown quickly and many businesses planned strategy while in the midst of execution and need to step back and assess their true IIoT maturity,” said Jim Morrish, Co-Chair of the IIC’s Business Strategy and Solution Lifecycle Working Group and co-author of the IIoT Maturity Assessment tool. “The IIoT Maturity Assessment will help companies get a baseline for their maturity right now and assess it in regular intervals to track their progress.”

This framework of four main dimensions and their corresponding strands will spur your thinking into broader areas beyond predictive maintenance or cost reduction programs.

The framework:

Business Strategy

  • Market context
  • Strategic context
  • Business model innovation and refinement
  • IoT Foundations

Business Solution Lifecycle

  • Interface to business strategy
  • Solution design
  • Project team structuring
  • Project management
  • In service monitoring and feedback

Technology

  • Technology strategy
  • Reference architecture and standards
  • Platforms stack
  • Data location transparency

Security

  • Governance
  • Enablement
  • Hardening

“There’s a real difference between using IIoT to streamline processes and using it to create new revenue streams or make better business decisions,” said Ian Hughes, Senior Analyst, Internet of Things, 451 Research. “A tool like this can be a real eye opener for an organization wanting to transform their business to remain competitive and increase profits.”

The IIoT Maturity Assessment considers 63 individual capabilities, each with five levels of maturity within the above framework. For example, under strategic context, a maturity level can range from a limited number of key individuals having stepped up to IIoT ownership to full ownership of IIoT within an organization. The IIoT Maturity Assessment provides feedback about the level of maturity and highlights areas that may require development.

The final outputs provided to users also provide links to the IIC Body of Knowledge for reference and to help improve their maturity. This includes collaborative resources developed by industry leaders from the IIC membership, including IIC foundational documents (Industrial Internet Reference Architecture, Industrial Internet Security Framework, Industrial Internet Connectivity Framework, Business Strategy and Innovation Framework, Industrial Internet of Things Analytics Framework, and Vocabulary Technical Report) and other IIC documents and tools.

The IIoT Maturity Assessment is available in three levels of analysis: Quick, Standard (both open to everyone) and Detailed (IIC members only).

ABB Names New Country Managing Director

ABB Names New Country Managing Director

ABB has appointed Maryrose Sylvester as Country Managing Director (CMD) and Head of Electrification for the United States, effective August 1, 2019. In the CMD role, she will succeed Greg Scheu, who will support a smooth transition until his retirement at the end of October 31, 2019.

Sylvester was most recently President & CEO of “Current, powered by GE”, a GE startup business that was acquired in April by New York-based private equity firm American Industrial Partners. Having spent her career at GE, she held several executive-level positions, including President & CEO of GE Lighting, of GE Intelligent Platforms/GE FANUC, which was GE’s longest-running joint venture with a Japanese company, and of GE Quartz.

I remember interviewing Sylvester during her tenure as president of GE Fanuc/GE Intelligent Platforms. She did well at a relatively small unit and obviously progressed within the organization.

These corporate changes at the top are not always relevant to most working engineers and managers. The thing I find most surprising is that ABB reached out to GE for new management talent. First, it shows just how similar the GE and ABB businesses are. In fact, throw in Honeywell, Schneider Electric, and Siemens as part of an industrial big five. Emerson is lurking just behind, but it is refocusing. Rockwell Automation has eschewed following a similar path and seems to be in a group with companies such as Beckhoff Automation.

A second thought occurred which is that I’m surprised by a selection from GE given the less than satisfactory fit of Joe Hogan who came from GE to ABB as CEO.

“Maryrose Sylvester brings extensive experience of managing and transforming industrial businesses and of applying digital technologies in industry,” said ABB Chairman and CEO, Peter Voser. “Her proven track record at GE makes her an ideal candidate to run our Electrification business in the US and to be our CMD for the US.”

Sylvester is a board member of Harley-Davidson and a member of the board of governors of the National Electrical Manufacturers Association. She also sat on GE’s Corporate Executive Council and its Commercial Council, and was a member and co-founder of GE’s Women’s Network.

“On behalf of the Board of Directors and the Executive Committee, I would like to thank Greg Scheu for his many years of committed service to ABB in numerous leadership roles, and especially for his strong contributions as Region President Americas, US Country Managing Director, and head of Group service and business integration,” Voser said. “Under his direction, ABB has significantly strengthened its market presence in North America and positioned itself as a digital technology leader among key customer groups. We wish him every success in his future endeavors.”

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