PTC to Acquire ITEDO Software - Frequently Asked Questions

On October 18, 2006, PTC (Nasdaq: PMTC) announced it acquired privately held ITEDO Software for approximately $17 million in cash. ITEDO specializes in the development and sales of software solutions used to create technical illustrations. This FAQ is intended to help PTC and ITEDO customers, partners, media and shareholders understand details about the transaction. Once the integration process is under way, customers and partners will receive additional information from PTC.

Q: Who is PTC?
A: PTC provides leading product lifecycle management (PLM), content management and dynamic publishing solutions to more than 40,000 companies worldwide. PTC customers include the world's most innovative companies in manufacturing, publishing, services, government and life sciences industries. PTC is included in the S&P 500 and Russell 2000 indices. PTC is based in Needham, Massachusetts and has over 4,200 employees in more than 20 countries around the world.

Q: Who is ITEDO?
A: ITEDO specializes in the development and sales of software solutions used to create technical illustrations. Best known for their market-leading product, IsoDraw, ITEDO has revolutionized the process of creating and maintaining isometric technical illustrations. Illustrations can not only be created from scratch and from legacy illustrations, but they can also be derived automatically from existing 3D and 2D design data, ensuring significant productivity benefits for customers. ITEDO has over 2,400 customers in multiple discrete manufacturing vertical markets including automotive, aerospace and defense and industrial products. ITEDO is privately held and headquartered in Hennef, Germany, near Cologne, with 34 employees primarily in Germany and the United States.

Q: What are the financial terms of the transaction?
A: PTC paid approximately $17 million in an all-cash transaction. Other financial terms were not disclosed.

Q: Why was PTC interested in acquiring ITEDO?
A: PTC is constantly evaluating opportunities that will strengthen or expand our solutions offerings, while delivering potential for both revenue and earnings growth. We also engage in strategic discussions with our customers about our product roadmap. Customer demand was a major factor in both the acquisition of Arbortext as well as ITEDO. ITEDO is particularly interesting to PTC for the following reasons:

  • This acquisition will deliver value to existing PTC customers. Creating accurate technical publications in a timely manner is a significant customer challenge. We first began to address this with our acquisition of Arbortext. With ITEDO, PTC will fill out its technical publications offering, enabling significant time-to-market and quality benefits for customers.
  • ITEDO’s IsoDraw product is the leading solution for authoring technical illustrations in multiple vertical markets. This acquisition gives PTC a leading, complementary solution to leverage across its global distribution model within discrete manufacturing. It also helps improve PTC’s ability to sell outside our own customer base with a more complete technical publications solution.

Q: Don’t we already have drawing capabilities in Pro/ENGINEER?
A: Engineering drawings and technical illustrations are typically quite different from each other. Engineering drawings are used to fully and clearly define requirements for manufactured products. Items typically shown on an engineering drawing include views of the part as it looks from the front, right, left, top, bottom, or back, and are typically positioned relative to each other, all the dimensions to manufacture the part, surface finishes, and material callouts, for example. In contrast, technical illustrations are typically presented in an isometric view, with irrelevant details suppressed/removed, and shown in the environement the product is used, whether in stages of assembly, stages of dissassembly for service and support pruposes, or interacting with a human being depicting the use of the product by a consumer or service professional.

Pro/ENGINEER provides capabilities to create 2D detailed engineering drawings with complete associativity back to the model. But Pro/ENGINEER has not provided capabilites to easily create clear technical illustrations. The acquitsion of ITEDO will give our customers the ability to create associative technical illustrations that will help them clearly convey the use of their products in a variety of situations.

Q: How will the ITEDO solutions complement the PTC product portfolio?
A: Complementary to PTC solutions, which together represent the Product Development System, ITEDO solutions will become an important part of the Arbortext product family, providing extensive 2D technical illustration capabilities today and establishing a platform for 3D interactive content for technical publications in the future. The combination of PTC and ITEDO will provide customers a Product Development System that will optimize the technical publications process. With the PDS, manufacturers will be able to:

  • efficiently and easily use 3D CAD data to create associative 2D technical illustrations reflecting the current configuration of the product,
  • collaborate in a distributed environment,
  • control and manage the illustrations relative to their source CAD data,
  • incorporate illustrations that exactly match the product configuration, and
  • dynamically assemble technical publications with the right text and illustrations for communication to a wide variety of audiences in the format best suited for their purpose

Q: Why is this good for both companies’ customers?
A: ITEDO extends the value of PTC’s Product Development System, enabling companies to create highly configured versions of documentation earlier in the product or service development process, while eliminating the duplication of work inherent in the process today. PTC plans to deliver a tight integration between its solutions and ITEDO solutions and development is currently underway. Joint customers will benefit from this integration by improving their ability to drive process efficiencies. PTC is committed to serving all of the customers ITEDO has served to date, so ITEDO customers can rest assured that we will continue to develop and improve ITEDO solutions, whether used in conjunction with PTC solutions or other applications. Furthermore, ITEDO customers can benefit from the improved global scale and financial strength that comes along with being a part of PTC, including award-winning technical support available world-wide in local languages.

Q: What will be the impact on the ITEDO organization?
A: The integration will take place during the next six months. Dieter Weidenbrueck, ITEDO’s founder and CEO, along with key ITEDO executives and employees will be focused on helping to integrate the businesses in a way that ensures ITEDO is positioned to continue its track record of delivering industry leading products and customer value. ITEDO’s sales and services teams will provide support to ITEDO accounts. ITEDO’s sales team will also support PTC’s sales team in serving existing PTC customers. Account management for joint customers will be determined based on customer needs. As we integrate the businesses in the coming months, more details will be provided to PTC and ITEDO customers.

Q: How will this acquisition affect the development of ITEDO’s product line?
A: ITEDO’s products are a natural extension of PTC’s product line. PTC wants to ensure that ITEDO continues to grow and thrive in technical illustration departments worldwide; therefore, PTC will continue the development and expansion of ITEDO’s product lines. For example, PTC will expand language support beyond ITEDO’s current support for English, French, German, Italian and Japanese.

Q: Who should customers or partners contact if they have questions about the acquisition?
A: PTC and ITEDO have developed a communications program for both companies’ customers and partners. If after reviewing the information posted on both companies’ websites and other communications vehicles you have remaining questions, please contact your current PTC or ITEDO account representative.

Q: Who should media or analysts contact if they have questions about the acquisition?
A: Please contact one of the following: