Bentley may still be preparing for an IPO, but there has been some important news on its relationship with Siemens that could have big ramifications in the future. By Martyn Day
November 2016 was the second Year in Infrastructure event at which Bentley has been under its IPO rules, which means it can’t reveal its financial earnings – something which has been a bit of a tradition, despite being a private company and, as such, not required to do. The company is biding its time as to when the market conditions best suit a Bentley Systems IPO. It’s still one of the largest privately held software firms in the USA.
While the election of Trump may be a shock to many of us, one of the things he has said he is committed to is a deal to allow US firms to repatriate income earned outside of the USA without punitive taxation (USA corporate and state taxes are over 40%).
Many American Corporations keep money outside of the US — so many that it’s estimated that there is over $2 Trillion of offshore profits. One wonders how this will impact US tech firms and the whole investment and shares market should this money make it to America. Combine that with a campaign strategy to rebuild America’s Infrastructure, with Bentley customers including the majority of US State Department of Transports, this could very well change market conditions in its favour
Siemens Invests
For a few years now it’s been rumoured that Bentley and Siemens could be more than strategic business partners. The companies work closely together in the Factory Design market combining manufacturing, architectural and structural technology with factory components and layout tools. Both firms are ‘corporate’ in style and have superb engineering pedigrees.
In the week following YII 2016, an announcement was made indicating that Siemens and Bentley Systems are in fact getting closer together with a formalised, strategic alliance agreement to advance infrastructure project delivery and asset performance in complementary business areas. Siemens and Bentley will initially invest at least €50 million in developing joint solutions to enlarge their respective offerings for infrastructure and industry to the benefit of the end-customers.
This work will uniquely leverage new cloud services for a connected data environment to converge respective digital engineering models from both companies. In addition to those elements of the agreement, approximately €70 million of secondary shares of Bentley’s common stock has been acquired by Siemens, under a company program that will continue until such time as Bentley Systems’ stock is publicly traded.
This ongoing acquisition of Bentley stock is extremely significant. The last time a software / engineering firm owned so much Bentley stock was back in the days when Intergraph owned a significant number of shares. With Siemens having also just acquired Mentor Graphics (electronics CAD software firm), it’s clear that Siemens has an appetite for AEC, and is astutely watchful of what its main rival Dassault Systèmes is doing in the space.
Siemens and Bentley Systems have a track record of complementing their respective portfolios through the licensing of each other’s technology. For example, Bentley’s reality modelling software has been integrated into Siemens Process Simulate to leverage laser-scanned point clouds in modelling the existing context of brownfield industrial environments.
The automotive industry manufacturer Turnkey Manufacturing Systems (TMS) successfully employed the innovative point cloud capabilities to create a “digital twin” of its production line to significantly enhance its planning and validation processes, while saving time and costs.
The new investment initiatives will involve virtually all Siemens divisions. The major benefit will be accumulating intelligence from Siemens solutions throughout Bentley’s complementary applications for design modelling, analytical modelling, construction modelling and asset performance modelling. As a result, the integrated and accessible digital engineering models, such as the “digital twin” viewed through an immersive 3D interface, will, according to Bentley, enable unprecedented operational performance, visibility and reliability. This work will converge digital engineering models: physical engineering models in their 3D physical reality context by way of Bentley’s software solutions and the corresponding functional engineering 2D models within Siemens’ solutions.
Siemens and Bentley Systems have identified opportunities to work together in Energy Management, Power Generation, Building Technology and Mobility where each company can leverage their respective technology and industry expertise to bring new business value to the market. For example, Bentley’s applications for the 3D modelling and structural analysis of industrial and infrastructure assets, complement Siemens’ solutions and domain expertise in electrification and automation. Siemens and Bentley Systems will each provide software from the other to deliver complete solutions from either company to the benefit of their respective customers in order to improve their project and asset performance through simulation and virtual commissioning. Development work will benefit from and extend Siemens’ and Bentley Systems’ established commitments to openness and interoperability.
Bentley Systems CEO Greg Bentley explained, “Only with Siemens could we so purposefully advance beyond merely linking the ‘Industrial Internet of Things’, to ultimately leverage digital engineering models for visual operations and connected infrastructure asset performance. Given our long history of sharing complementary technologies, we are very excited to now contribute so broadly to Siemens’ industrial digitalisation leadership.”
Conclusion
Looking at route to market, style of customer, depth of product and a total focus on team and document management Bentley and Siemens are very well matched in this alliance. Siemens for the first time is actively looking outside of factory design and can see that Bentley’s technology and user base would also benefit from existing Siemens technologies and wide array of automation products. It will be interesting to see the fruits of the co-development and to see what the net result of these initial moves will be.
This article is part of a Bentley Systems Year In Infrastructure special report. Read the other articles below
The age of the reality mesh: Bentley Systems is forging ahead with Reality Capture by embedding reality meshes into its foundation platform.
OpenRoads Designer: This new breed of civil design tool combines mesh data with detail design in one dynamic environment.
Cloud analytics: Knowledge is power Bentley is helping engineers ‘design out’ delays before they happen, by giving them access to real-time supply info.
The future of AR: The HoloLens and the use of reality meshes have got round tracking issues, paving the way for new AR applications.
LumenRT embraces VR: LumenRT, an easy-to-use real time viz tool with a powerful ‘game engine’ environment, now offers VR support
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