Aptiv PLC, which is developing technology for safer, more sustainable, and connected vehicles, today announced a definitive agreement to acquire Wind River Systems Inc. from TPG Capital for $4.3 billion in cash.
“The automotive industry is undergoing its largest transformation in over a century, as connected, software-defined vehicles increasingly become critical elements of the broader intelligent ecosystem,” stated Kevin Clark, president and CEO of Aptiv.
“Fully capitalizing on this opportunity requires comprehensive solutions that enable software to be developed faster, deployed seamlessly, and optimized throughout the vehicle lifecycle by leveraging data-driven insights,” he said. “These same needs are driving the growth of the intelligent edge across multiple end markets.”
“With Aptiv and Wind River's synergistic technologies and decades of experience delivering safety-critical systems, we will accelerate this journey to a software-defined future of the automotive industry,” said Clark. “In addition, we are committed to further strengthening Wind River's competitive position in the multiple industries it serves.”
Dublin, Ireland-based Aptiv said it has more than 180,000 employees worldwide working on “solving the industry's toughest challenges with scalable, intelligent platforms that accelerate the transition to software-defined, electric vehicles.” In 2020, the company formed the Motional autonomous driving joint venture with Hyundai Motor Group.
Wind River offers edge-to-cloud software
Alameda, Calif.-based Wind River claimed that its software is used in more than 2 billion edge devices across more than 1,700 customers globally. The company said its portfolio enables the secure development, deployment, operations and servicing of mission-critical intelligent systems. It reportedly generated approximately $400 million in revenues in 2021.
Wind River Studio is a platform that enables full product lifecycle management for edge-to-cloud use cases, it added.
Wind River said it has served the aerospace, automotive, defense, manufacturing, medical, and telecommunications industries for four decades. The company added that it offers services, support, and a broad partner ecosystem.
“Wind River has established itself as a worldwide leader in cloud-native, intelligent edge software that delivers the highest levels of security, safety, reliability, and performance,” said Kevin Dallas, president and CEO of Wind River.
“Combining Wind River's industry-leading software, customer base, and talent with Aptiv's complementary technologies, global resources, and scale will realize our vision of the new machine economy,” he said. “Together, we will accelerate the digital transformation of our customers across industries through best-in-class intelligent systems software.”
TPG deal to close midyear
Aptiv said it will finance its acquisition of Wind River from TPG Capital through a combination of cash and debt. The transaction is expected to close in the middle of 2022 and is subject to customary conditions, including receipt of applicable regulatory approvals.
“It has been a privilege to partner with Kevin Dallas and the management team to transform Wind River into a leader in the intelligent systems market,” said Nehal Raj, co-managing partner, and Art Heidrich, principal at TPG Capital. “The mission-critical industries they serve are digitally transforming at a rapid pace, and we see significant opportunity ahead as companies look to adopt innovative software solutions that allow them to leverage data to make better and faster decisions.”
TPG Capital is the private equity platform of San Francisco-based TPG. The global alternative asset management firm was founded in San Francisco in 1992 and has investment and operational teams in 12 offices globally. It has $109 billion of assets under management.
Aptiv to combine automotive software
Aptiv said the acquisition will allow it “to execute against the large software-defined mobility opportunity and expand into multiple high-value industries.”
The company said the combination will enable multiple applications as compute and processing move closer to the edge. It said it expects connected devices, including vehicles, to expand in complexity and capabilities.
Aptiv added that it plans to combine Wind River Studio with its complementary Smart Vehicle Architecture (SVA) platform and automotive expertise to provide customers with a faster and economical path to full vehicle software architecture. Led by Kevin Dallas, Wind River will continue to operate as a stand-alone business within Aptiv as part of its Advanced Safety & User Experience (AS&UX) segment.