Cranes Software acquires ETA

Cranes Software International Ltd has announced the acquisition of US based specialized auto consulting and product development firm, Engineering Technology Associates (ETA) through its subsidiary Cranes Software Inc.,

At a strategic level this initiative represents the Company's foray into the fast growing Chinese Auto market. ETA, a tier one vendor to the top three US car manufacturers was founded in 1983, and is headquartered in Troy Michigan. Their expertise lies at developing Computer Aided Engineering (CAE) centric products for auto safety, vibration, and noise testing, under simulated conditions. ETA caters to the growing safety needs of the auto industry and is recognized for its proven expertise in simulation testing. ETA products at bundled with LS Dyna, a leading global software provider in CAE space.

ETA's long standing relationships with the car manufacturers and their vendors have helped it develop products in specific areas as well as provide high end solutions. A core team of over 120 engineers provide high end consulting to several trans-national automakers and vehicle manufacturers in the US. It has an advanced design and product development centre in China and the Chinese operations are poised for growth in the next few years, in pace with rapid expansion of the Chinese auto industry. CSIL will synergize and expand the design and development efforts between the Bangalore and ETA-China operations with headquarters in Shanghai.

Discussing the value that Cranes will accrue through this acquisition, Asif Khader, Managing Director, of the Company said, "The acquisition of ETA has added tremendous boost to our product portfolio since we are one of the leading providers of CAE centric products ranging from Engineering Design to Product Development to Lifecycle Management, for the auto industry. This acquisition also gives Cranes access to the lucrative Asian markets and thereby expand the operations of the Chinese design centre by forming alliances with leading Asian car manufactures for end-to-end design and development specifications. Accordingly, Cranes will be able to leverage its core design testing, virtual simulation and product design skills across a broader range of engineering needs to serve the high growth oriented emerging Asian economies."

Key benefits of transaction

1. This acquisition will enable Cranes to expand distribution of its flagship NISA suite of Finite Element Analysis (FEA) products along with the products suite of ETA

2. Cranes will have access to the established Chinese design center, which will be expanded and leveraged to form alliances with leading Asian car manufacturers

3. Productize the systematic knowledge that ETA has acquired over the last twenty four years of consulting and design services at the development centre in India

4. Leverage the core design testing, virtual simulation and product design skills across a broader range of engineering needs that are fast emerging on the Indian landscape

5. Greater product support and resources, a broader range of products meet business needs, a commitment to innovation to meet next-generation technology needs available to customers
worldwide

Transaction Details

Cranes is acquiring ETA through its subsidiary in USA viz, Cranes Software Inc and will invest an amount of approximately Rs 720 million in this including to operationalise the expanded market reach by:

1. exploring cross-sell and up-sell opportunities by taking its existing range of products to ETA's client base.

2. helping promote the CAE business across the globe