When Infor announced its intention to sell its enterprise asset management (EAM) business to Hexagon, a digital reality solutions company, we immediately thought, why? It can’t be about the money – despite the astronomical sale price, Infor is owned by Koch Industries, one of the best capitalised enterprises in the world. When ERP Today met with Soma Somasundaram, chief technology officer and president of products at Infor, we had one burning question – why sell a profitable business unit when Infor is still in a growth phase?

“Infor does ERP really well and Hexagon does asset performance really well – we believe that Hexagon is a good home for our EAM business,” said Somasundaram.

Although the transaction is yet to complete, the total deal value is close to $2.7bn – with $800m in cash and the balance in shares giving Koch (Infor’s owners) a 5 percent stake in Hexagon.

Infor remains determined to provide excellence to its customers and it goes without saying that this deal was thoughtfully orchestrated with customer experience front of mind. According to, Somasundaram the rationale behind the sale is two-fold. “To be really good at something takes a lot of time. We want to remain focussed on what we do well and that is ERP,” said Somasundaram. Infor’s overlap of EAM and ERP customers is relatively small; Hexagon needed a solid EAM foundation to expand its asset performance capabilities and Infor is able to provide that. The sale allows both parties to strengthen specific capabilities thereby keeping customers as the singular focus.

The transition will have little to no effect on Infor’s existing customers and the ambition is that those customers will only see positive changes following the sale. Hexagon will acquire around 3,500 customers and will continue to deliver the EAM solution through Infor’s platform.

The business landscape of old has changed dramatically over the last year and as the EAM market evolves from traditional asset management to asset performance management (APM), customers require broader solutions to manage the entire lifecycle of their assets – from the design/build phase to the operation phase. The sale of Infor’s EAM is in keeping with this shift as Hexagon is able to provide these broader solutions while Infor sharpens its focus on core ERP.

The divestiture and strategic relationship positions Infor to:

  • Combine its EAM technology with Hexagon’s digital reality solutions – including sensor, software and autonomous technologies – to produce a better outcome for customers, and
  • Further focus on its strategy of delivering industry-specific cloud ERP suites (CloudSuites) that provide customers with sustained operational advantage and to maintain a long-term view of the market.

Infor EAM is a robust and scalable asset management software that helps organisations digitise and optimise maintenance operations to reach new levels of efficiency. Hexagon is a global enterprise that delivers digital reality solutions, combining sensor, software and autonomous technologies. It uses data to boost efficiency, productivity, quality and safety across industrial, manufacturing, infrastructure, public sector and mobility applications.

“This is a win-win for Infor and Hexagon, as well as our customers and employees,” said Infor CEO Kevin Samuelson. “It enables Infor to double-down on providing innovative, industry-specific solutions that help address our customers’ biggest business challenges. And it enables us to partner with a company that is in a unique position to drive further digital transformation for Infor EAM customers by integrating Infor EAM’s asset management capabilities with Hexagon’s digital reality solutions and platforms.”

Ola Rollén, Hexagon president and CEO, said, “By integrating Infor EAM’s built-in, industry-specific asset management capabilities with our digital reality solutions and platforms,” he explained, “we can improve capital asset performance in ways beyond what EAM can achieve standalone – from enhancing predictive maintenance and reducing energy usage to supporting other sustainability initiatives. Infor EAM customers and partners can expect a smooth transition with significant synergies that will produce faster growth and greater opportunities, including expansion into new verticals, as well as underserved markets such as Asia Pacific.”

 

Have you got news to share? Please send your stories to beckie@erp.today