Munich-based Nemetschek Group has acquired Solibri, a market leading BIM application software developer based in Helsinki, Finland. Nemetschek obtains 100 percent shares of the privately held company’s share for 32 million euros.
Global BIM Model Checker Aligns Well with Nemetschek Group
Nemetschek has reportedly beat several potential buyers—none of them named but do see our analysis section below—because of its “group structure” with an AEC-focused German holding company that acts as both public market face and supportive, liberal yet disciplined parent company. Within the “group” Nemetschek sibling companies maintain strong independent brands and this is something other potential suitors likely couldn’t replicate.
Solibri is a globally leading and internationally aligned provider of software solutions for the quality assurance (QA) and quality control (QC) of BIM models. The “Solibri Model Checker” application validates that BIM models in particular are compliant in terms of integrity, quality and country-specific standards throughout the whole design and building processes.
The evaluation of entire projects according to logical analysis rules which detect errors is unique worldwide. Solibri—like all the brands of the Nemetschek Group—is a proponent of open standards (Open BIM) and enables the application of building-relevant information via open interfaces across all stages in the building process.
Solibri’s Price and Footprint
Solibri was founded in 1999 and has around 35 employees. In addition to its headquarters in Helsinki, the company has branches in the United States and United Kingdom, plus sales organizations in Spain and Germany. For the 2015 financial year, Solibri anticipates revenue amounting to just under EUR 5 million, an increase of more than 50 percent (50%) compared to the previous year. An operating margin (EBITDA margin) of more than 20 percent is expected in 2015.
The fixed component of the purchase price of the acquisition amounts to EUR 32 million. Financing is through the taking out of a loan. This is supplemented by earn-out components, which are linked to the increase in revenue and to profitability in the financial year of 2017. According to today’s perspective, earn-out payments amounting to approximately EUR 13 million are forecast. The acquisition is expected to be completed by the end of 2015.
Solibri Sits at Center of Nemetschek Group
The Nemetschek Group says that strategically Solibri is very significant for the further development of the group as a whole. Solibri will have a central position in the Nemetschek Group’s solution portfolio and connect all brands and their products by means of an integrated and holistic workflow.
Solibri also already has a high degree of presence in the building sector, which will reinforce customer access for the Nemetschek Group in this strongly growing market. Solibri targets clients across the entire AEC industry life cycle—as in construction and development companies, general contractors, sub-contractors, architects, engineers and building owners. Sales are made directly via a network of resellers. Today the solutions are already being sold worldwide.
“The acquisition of Solibri has been consistent with our acquisition strategy in the AEC industry and greatly strengthens our global position as a leading provider of Open BIM solutions. With the support of the Nemetschek Group, Solibri will continue to pursue its international growth strategy and benefit from our global customer access,” comments Patrik Heider, CFOO and Spokesman of the Nemetschek Group. “In Solibri we see a strongly growing company which will strategically strengthen our solution portfolio.”
Solibri, in turn, will profit from a strong group with an international sales focus and direct access to a growing customer base with more than 1.8 million users worldwide. “Synergies with the Nemetschek brands pave the way for further successful growth. I am convinced that we are an excellent fit for the Nemetschek Group and that we will benefit considerably from one another and further reinforce our market position,” says Heikki Kulusjärvi, CEO of Solibri.
Government Compliance Initiatives Drive Growth
As part of the acquisition news, Nemetschek Group acknowledged that BIM standards for publicly funded building projects is a much-discussed topic worldwide as compliance becomes increasingly required by governments and public authorities. No smart-minded governments and public authorities wish to have their BIM data stuck in single-vendor proprietary data formats, but instead accessible via open file formats supported by a multitude of competitive industry providers.
With comprehensive application of BIM regulations, the demand for Solibri solutions is growing since they perform the required quality checks and improve processes. This results in considerable advantages in terms of cost and efficiency as well as a high degree of design reliability and transparency.
Solibri’s application solutions include a tightly related family of three products—Solibri Model Checker, Solibri Model Viewer, and Solibri IFC Optimizer. All three products run on both Mac and Windows operating systems, which is particularly well-fitting given that the two flag-ship BIM authoring programs under the Nemetschek umbrella—ArchiCAD and Vectorworks—also run natively across both platforms as well. So besides the Open BIM philosophy orientation, Solibri also shares a passion for supporting both Windows and Mac clients, the latter increasingly more important as Apple’s Mac share continues to slowly eat into Windows PCs.
Only the first product is the money maker in the family. Solibri Model Viewer and IFC Optimizer and both free products. The product costs around $6,000 USD, so it is not inexpensive, yet it is not required at every user’s seat. Still, based on the earnings projected for 2015, one can roughly guess at possible seat counts (software licenses) for the flagship product. When one estimates such a figure and compares it to all the BIM-based users within the overall Nemetschek Group there is ample opportunity for growth of Solibri seats just within the Group.
Most importantly for the Nemetschek Group, this acquisition provides the entire portfolio the market leader in BIM model quality assurance and quality control with a range of other advantages, including its cross-platform availability and its excellent IFC Optimizer tool. As the BIM market matures and models are utilized more fully for their information, Solibri’s tool chain becomes more valuable; as governments demand more standards compliance for the procurement of building delivery, Solibri’s Model Checker will grow as an indispensable tool.
Solibri is the leader in BIM Quality Assurance and Quality Control. Providing out of the box tools for BIM validation, compliance control, design process coordination, design review, analysis and code checking. Solibri’s corporate message is to develop and market quality assurance solutions that improve the quality of BIM-based design and make the entire design and construction process more productive and cost effective. Solibri’s customers include major building owners, construction companies, architects and engineering firms in more than 70 countries.