Whom will GE acquire?
You know the expression, 'A rising tide floats all boats'. Well most industrial automation companies are doing well now, and this signals the distinct possibility that more major acquisitions are in the wind.
Rockwell Automation 2007 revenue was up 10% at US$5bn with income of $600m. With some questionable acquisitions in the UK, now the subject of angry rants (from disgruntled employees who have no other way to vent) on the JimPinto.com weblogs,
Rockwell is an acquisition target for either ABB or GE.
ABB has a lot of process systems (via Bailey and other acquisitions) but not much of the PLC base that Rockwell brings. Unless Rockwell itself makes a BIG acquisition soon (not the systems integrators and minor plays it has made recently) it will become a bite for the biggies.
Meanwhile, GE has GE-Fanuc (PLCs and software from the Intellution and other acquisitions) but no DCS process systems. Invensys is dangling in the wind, within reach.
Invensys dangling in the wind
Invensys had revenues of £543m for Q2, up 5%, with profit of £59m, improving slightly from 10,5 to 10,9%. Invensys Process Systems (IPS) revenues increased £190m to £205m, with profit of £26m, up from £23m.
One current underground drumbeat has GE acquiring somebody in the US$500m to $1bn range. This can only be the hardware parts of Invensys - Foxboro, Triconex, and Eurotherm.
After just selling off APV (an unrelated orphan) to SPX for £250m Invensys may be positioning itself as a pure software and services play. Of course, in the meantime, it still has to dispose of its other problem child, the Controls Division.
Meanwhile, Foxboro is in turmoil after new CEO Paulett Eberhart decided to move the IPS HQ to Dallas, Texas. Heck, popular IPS president Mike Caliel should have considered this as an alternative. He was commuting to his home in Dallas, before he exited to run his own show.
With the latest Dallas move, many long-term Foxboro people were exited, including most of MarCom. But perhaps most painful was the exit of popular Ken Brown, long-time Foxboro stalwart and acting president. Many felt that he was the obvious choice when the surprise appointment of outsider Eberhart was announced.
Meanwhile, Wonderware president Mike Bradley was also exited. On receiving the instant bush-telegraph announcement via the JimPinto.com weblog, I spoke with Mike, who handled the whole thing with great professionalism. He lauded his replacement, Sudipta Bhattacharya, who had just recently joined (senior VP of SAP) reporting to Mike, who hired him.
General impressions (at Wonderware and outside the company) are that Sudipta is a good man. It remains to be seen how he gets on with CEO Ulf Henrikkson, to whom he reports directly, not via IPS president Paulett Eberhart.
Wonderware's InTouch 10.0 and System Platform 3.0 were recently described by Mike Bradley as "The most important announcements in Wonderware's 20 year history". In the word of one industry guru, "It would be easier to sell InTouch and InFusion if they did not have to drag around Foxboro".
Stay tuned....
DARPA Urban Challenge
In November 2007 11 robotic vehicles participated in the Urban Challenge sponsored by DARPA, the Pentagon's research wing. This was a milestone event demonstrating robotic cars' ability to follow complex routes and negotiate traffic completely under their own control.
The winners were decided on ability to steer safely around an abandoned military base, travelling autonomously for 6 hours and 60 miles (96 km). A sports utility vehicle nicknamed 'Boss', developed at Carnegie Mellon University in Pittsburgh, won the $2m first prize. Stanford University, which won the 2005 race, came in second and Virginia Tech was third. Only six of the 11 finalists finished the course.
$3,5 million in prizes was offered to jumpstart robotics developers and help fulfil the official US 'mandate' that one-third of all military vehicles be unmanned by 2015.
The race really showed how far away that goal still is: at one point, two robotic SUVs collided. Another mistook a driveway for a road. One came within inches of ploughing into a concrete pillar and had to be taken off the course.
Taken together, all of these imperfections prove that the dream of a totally driverless fleet of military vehicles is still too technically complex. But what DARPA's race really demonstrated is that robotic driving technology is ready to work together with human drivers - not replace them.
Jim Pinto is an industry analyst and commentator, writer, technology futurist and angel investor. His popular e-mail newsletter, JimPinto.com eNews, is widely read (with direct circulation of about 7000 and web-readership of two to three times that number). His areas of interest are technology futures, marketing and business strategies for a fast-changing environment, and industrial automation with a slant towards technology trends.
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