Dassault Systemes to acquire IBM's product lifecycle management organization

For more than 20 years, IBM has handled nearly all sales and support related to Dassault Systemes PLM and product modeling software. Once the new deal closes, 1,000 IBM PLM contracts will become Dassault's.


Dassault Systemes is making a major change in the way it sells its product lifecycle management (PLM) software. For more than 20 years, IBM has handled nearly all sales and support related to Dassault software. And for much of that time Dassault's profile was so low that, at least in North America, there was a widespread perception that IBM owned Dassault.

Now, Dassault is taking a major step toward changing that dynamic, announcing its intention to purchase the IBM organization that has been selling and supporting Dassault's software.

Bernard Chareles, President and CEO, Dassault Systemes

Bernard Charles, CEO, Dassault Systemes

Under terms of the deal, announced Tuesday, October 27, 2009, Dassault will pay $600 million cash for the IBM sales and client support operations dedicated to the Dassault PLM software portfolio.

Once the deal is closed-which is expected to be in the first half of 2010, approximately 1,000 companies operating under existing PLM contracts with IBM will become Dassault customers. An estimated 700 people employed in the IBM PLM organization also will become Dassualt employees.

The companies insist, however, that while this transaction changes the terms of their partnership, it will not bring it to an end. The stated plan is for Dassault to become an IBM Global Alliance Partner, and for the two companies to continue jointly investing in developing, deploying, and delivering integrated PLM solutions.

The Dassault product portfolio includes solutions for nearly every aspect of developing and managing products-including CAD, product data management, visualization, simulation, and manufacturing process management solutions.

While IBM is expected to continue working with customers on implementing Dassualt software, its stated objective in walking away from the sales side is to concentrate more on developing middleware, cloud computing platforms, and other infrastructure to support the efficient operation of the software.

"With this announcement, IBM is evolving its partnership with Dassault Systemes to better align our mutual strengths and better address our clients' PLM needs," said Tom Hawk, general manager, IBM Global Industrial Sector. "This transaction also helps fuel IBM's focus on PLM integration through middleware, business transformation and application services, and dynamic infrastructure."

Dassault President and CEO Bernard Charles said, "We are reaching a new level of customer engagement built on commitment, multi-industry knowledge and high-value solutions for sustainable innovation," added Charles. "Looking forward, the wide adoption of 3D lifelike experience and PLM will require the combination of direct sales, our network of partners and online communities."

Industry analysts agree this is a natural evolutionary development, but not necessarily for reasons given by IBM and Dassault.

"What made sense when the relationship started has changed based on the maturity of the PLM market," said Jim Brown, president of Tech-Clarity , a firm that tracks the PLM space. Dassault software is being used by a lot of major companies, and they have their own choices for their systems integrators and consultants. So over time, DS has developed relationships with other leading systems integrators. In the same way, IBM customers may be using DS solutions, or they could be using software from Siemens, PTC, or others. So IBM has developed those relationships. In addition, Dassault works with IBM, but also works with Microsoft and others from an infrastructure point of view. Having IBM and Dassault play more focused roles in the PLM ecosystem makes those relationships more straightforward."


For more analysis of the news from Jim Brown, read his blog , delivered throught Manufacturing Business Technology magazine's website.


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