Sandvik Acquires Connecticut-Based CNC Software For Undisclosed Sum

Sandvik AB SDVKY has agreed to acquire US-based CNC Software Inc., a CAD/CAM software solutions provider for manufacturing industries and the company behind Mastercam, for undisclosed financial terms.
Tolland, Connecticut-based CNC Software, founded in 1983, is an independent, family-owned company with 220 employees.
CNC Software will be reported in the Design & Planning Automation division within Sandvik Manufacturing and Machining Solutions.
With this acquisition, Sandvik gains a CAM brand in the Mastercam software suite with an installed base of around 270,000 licenses/users.
CNC Software's 2020 revenue totaled $60 million with an EBIT margin of 25%-30%.
The underlying EBITA margin is accretive to Sandvik Manufacturing and Machining Solutions. The impact on earnings per share will initially be slightly negative.
Sandvik will include transaction costs estimated at SEK 25 million in Q3.
The deal is expected to close during 4Q21. In conjunction with the closing, Sandvik will make a write-down of overlapping assets representing SEK 30 million.
Sandvik held cash and cash equivalents of SEK 17.25 billion as of June 30, 2021.
Price Action: SDVKY shares are trading higher by 2.05% at $25.60 on the last check Wednesday.