ARC report confirms ABB continuing DCS market dominance

ARC Advisory Group is one of those typically American consultancy organisations that produces reports describing technology trends and competitive analyses that are then sold to the suppliers in the industry. Undoubtedly they are also employed to produce specific reports at the request of single specific clients, but the main reports publicised for public sale are the overall market surveys. Without paying a lot of money, the general public don’t get to see these.

All the data from the reports is generalised, and as ever, subject to interpretation, so hopefully each client can find something that reinforces his optimism about his company’s place in the market. So they are essential sources of backup data for Board presentations and the like.

The ARC DCS market study

The recent ARC report on the “Distributed Control Systems Global Market 2016-2021” report provided ABB with sufficient confidence to issue a Press Release stating that the ARC had confirmed ABB to be the ‘#1 supplier of Distributed Control Systems Globally’, with a 20% market share ‘across industries’, making ABB the leader of ‘digitally enabled control and automation’. This is a continuation of the position they have held according to ARC since 1999.

Peter Terwiesch, President of the ABB Industrial Automation division echoed these findings: “With our installed base of over 70 million connected devices and 70,000 control systems, and an annual investment of $1.5 billion in research and development, ABB is leading the digital transformation of industry.”

Such reports and statistics were the bread and butter, and even the honey, for the reports written for the Industrial Automation Insider newsletter that your editor produced from 2010 to 2015. The focus for such a report would have been that with at most seven major suppliers competing for the top slot, a 20% market share would imply the dominance margin is (still) fairly slim!

The ARC report provides a competitive analysis of the market shares of leading suppliers by geographical region, and broken down into eleven major industry groups, as well as equipment type, project size and style. The ABB release specifically mentions the ABB activity as delivering sustainable progress for power, water and process industries.

The ABB Profile

More interesting in many ways were the specific project examples picked out by ABB as the prime examples of their expertise in several sectors, viz:

“ABB’s leadership in DCS stems from countless ground-breaking projects around the globe. ABB Ability System 800xA plays a key role in securing the success for Sadara, the world’s largest chemicals complex built in a single phase. The monitoring and automating of the entire production process is fully integrated with System 800xA, all coming together in 18 control systems and 260 operator work stations. The integration capabilities also helped the Garpenberg mine to become one of the world’s most cost-effective and modern mines in the world. Hoists, mill drives, ventilation, dewatering, substations, conveyors, crushers, ore storage, and maintenance, as well as document management and communications are seamlessly integrated to the automation system. Very recently Emami Cement has chosen System 800xA to automate its new production plant which will help boost infrastructure growth in India.

“ABB Ability Symphony Plus is, for example, the core solution for integrating new emission control technology at a power plant in Wisconsin, US; for protecting the UNESCO World Heritage site of Venice, Italy from high water by controlling the city’s MOSE flood barrier system; for providing the automation and electrification solution for Adani, the world’s largest solar power plant in a single location, in Kamuthi India; and for enabling the Vietnamese utility Saigon Water Corporation (SAWACO) to control and operate its infrastructure in real time, significantly reducing the amount of non-revenue water.”

Walt Boyes has expanded on this report in the December issue of the Industrial Automation INSIDER, which was published on 11 January 2018.

 

E+H reports on 2016 sales

The report that follows was first published on Eoin O’Riain’s Read-Out.net website in Ireland last week. It gives the first report on Nick Denbow’s visit to the E+H European presentation in Basel, which included a tour of the Maulberg manufacturing operation for level measurement products, like the NMR81 radar based systems. Financial results for the 2016 year were discussed with the 70+ journalists and media analysts attending.

This year, Endress+Hauser expanded the presentation of their annual financial results, inviting journalists from not only Germany and Switzerland, but including others from Belgium, the Netherlands and Great Britain. In all 70+ attendees heard Klaus Endress and Matthias Altendorf say that the consolidated Group sales fell slightly between 2015 and 2016, by 0.2%, achieving Euro2.1Bn. This fall was actually only because of currency fluctuations. “Currencies created a headwind for us last year,” said Altendorf. Working from the value of sales in local currencies, sales in total actually increased by 2.1%. Whilst the Group is family owned, their annual report is published and audited to the standards expected of any other international business.

CEO Matthias Altendorf emphasised that “When compared to overall industry growth, we held our own”. E+H performed well in Europe, but sales in America declined. Africa and the Middle East experienced solid growth, but in the Asia-Pacific region business stagnated.

Within Europe, the best performances for E+H came from Ireland, Italy and Finland. The best performing sectors in all countries were food & beverage, life sciences, and water & waste water. Overall business declined in oil & gas, chemicals and primary industries like metals. The power and energy industry sectors showed good performance outside Germany, where E+H also felt the effect of weak German exports and some internal restructuring. The oil & gas decline badly affected sales in USA, UK and Norway, although the UK sales centre gave a good performance by aligning efforts with other active market sectors.

Investment continues.

E+H plans for investment and growth continue for the current year. Earlier in the week a new factory extension was opened in Reinach, where flow products are manufactured. (see Read-out Signpost – “Flowmeter output growth requires new facilities” – 5 May 2017).  The journalists were given a tour of the manufacturing facility in Maulberg (D), where a new extension to the production area is in operation, and a new NMi level measurement system calibration facility for radar based systems has just been completed. This is certified suitable for calibration of the Micropilot NMR81 radar system, working at 80GHz, which achieves a +/-0.5mm accuracy over a 30m range, for use in oil storage tanks and oil terminals. There are plans now to extend this calibration facility to allow such calibration out to 40metres, as well as to extend the factory yet further: 1912 people work at E+H Maulburg, and 5200 people in the Basel region, out of the total E+H staff of 13,000.

Analytical measurements

The biggest growth area in E+H is actually in the analytical instruments that use Raman spectroscopy to analyse liquid and gas streams on-line. The major industries now applying this technique are within the life sciences sector, where immediate analysis of input and both gaseous and liquid effluent streams enables much closer control of biochemical and fermentation processes. Indeed the 2017 issue of the E+H corporate magazine “Changes” features a major focus on new applications in the Life Sciences industries.

Other new analytical techniques are developed for monitoring water treatment processing, for example in the new Swiss plants which by law have to have a fourth stage of purification, to remove hormones, phosphorus and other drug residues. The strength of E+H here derives from their strategic decision a few years ago to invest in the process analytical area, particularly in the field of spectroscopy, acquiring Kaiser Optical, Analytik Jena and SpectraSensors. “Our analytics strategy has been validated by the market,” said Matthias Altendorf.

Bundling IIoT activities

The acquisition of German SensAction AG in early 2017 also ties in with Strategy 2020+ which was rolled out last year. The company, headquartered in Coburg (D), manufactures innovative systems for measuring concentrations in liquids. Endress+Hauser is tackling the challenges of digitalization by bundling a number of activities. A new subsidiary in Freiburg in Breisgau,(D), is working exclusively on products, solutions and services related to the Industrial Internet of Things (IIoT).

The significance of digitalization can also be seen in the growing number of patent registrations. There were 273 first filings in 2016. The intellectual property rights portfolio thus boasts more than 7,000 active patents. R&D spending rose to 7.8 percent of sales. Endress+Hauser introduced 64 new products to the market. “We are investing in innovation for our customers,” underlined the CEO.

Trends in automation.

The focus for E+H sales and their customer base is broadly on automation engineers, so it was interesting to hear Matthias Altendorf comment that the statistics for industrial output show that the Britain has now dropped out of the top 10 countries in terms of automation business activity, whereas they had held a prominent position there some years ago.

The other aspect of interest was that there are distinct differences between countries, in terms of the sex of the engineers involved in the major projects served by E+H. In Germany they are mostly male, whereas the majority of engineers in Turkey are female. In South Korea and India there are high percentages of female engineers (and engineering journalists). Also, by industry, it is noticeable that in the biochemical and life science sectors the engineers are predominantly female.

Advances in battery technology

The opportunities for spin-out businesses and industries from university research projects are multiplying. The growth in this sector comes from the acceleration of technology in general, but also because the increased investment in education means there are a lot more research students, some with good ideas, but others just looking for topical subjects to latch onto for their research project. Also, industry has learnt that by funding some low cost university research, other ideas might emerge that might be of benefit.

A lot of attention is being given to new designs of battery, as there are some well-known major commercial projects where new systems are needed. First to come to mind would be batteries for electric cars like the Tesla. Here, low-cost, lightweight and relatively compact devices are needed, with high-power output and fast charging. Second are the batteries (or systems) needed to store the power generated by solar farms or wind turbines, during the hours when it is not needed, so that it is available for different times of the day. Possibly lower down the priority list are the small long-life battery systems needed for IIOT sensors and industrial sensors in general. These do not have the major numbers, or the (relatively) high price, so do not attract as much attention.

Eliminating standby power drain

So, it was all the more interesting to hear of research at Bristol University, in the UK, where Dr Stark and his colleagues in the Bristol Energy Management Research Group have developed an electronic chip that can switch on a sensor only when that sensor is being asked to provide or monitor data: for the rest of the time the chip and the circuits which it controls consume no energy at all. It may not be a new battery development as such, but it would allow a much extended battery life, by eliminating all stand-by current drain.

The principle is that the chip uses the small amount of energy transmitted in the interrogation signal from the system asking for the data, to trigger a circuit that switches the device on. The interrogation signal could be from an infrared remote control, or a wireless signal. The team developed their circuit using the same principles as those used in computers to monitor their internal power supply rails – to ensure the voltage does not dip below a certain threshold. The trigger signal uses a few picoWatts of energy, and a signal threshold level of 0,5 V, which is achievable from a passive sensor, just using the received wave energy.

The natural follow-on from this concept is that the trigger signal on some sensor applications could be derived from the event being monitored, such as a rapid increase in the sound or vibration levels of plant machinery. Also, for a security alarm, the movement of a hinge or similar could be sensed magnetically. Conventional power management techniques would be used to switch the sensor off once the data has been transmitted to, and acknowledged by, the monitoring systems.

Power storage

With solar and wind energy providing such a large part of the power used by the National Grid in certain areas, many ways are being researched to achieve power storage over the short term, such as 24 hours. There are already companies providing large storage systems with banks of conventional batteries, acting like very large uninterruptible power supply (UPS) systems. In Spain and the USA there are solar collector systems where the sun’s heat is concentrated onto a central collector, melting sodium salts: the heat is later used to drive a steam turbine. Further systems are being trialled where surplus energy is used to liquefy gases, or compress them in a high pressure chamber, later the stored gas can be used to drive a turbine generator.

A novel development of a battery cell reported recently is the use of a low cost electrolyte for use with aluminium and graphite electrodes. Dr Dai, at Stanford University, in collaboration with Taiwan’s Industrial Technology Research Institute, demonstrated such a battery powering a motorbike in 2015, but the electrolyte was expensive. The new electrolyte is 100 times less expensive – it is based on urea. Dr Dai sees this as a useful solution for storing solar power, even domestically – maybe new houses will have such a system underground, and call it a “Power storage pit”!

This article was first published in the April issue of “South African Instrumentation & Control”, a TechNews publication. This journal is kind enough to publish an article from Nick Denbow every month, as a report on stories of interest from Europe.

How DCS Vendors see their IIOT future

Engineers around the world are looking at how to benefit from various IIOT offerings: the survey below covering the approaches being adopted by some of the major DCS vendors was first published in South Africa, in the Technews South African Instrumentation & Control Journal, February 2017. Next month a similar article will cover the approach of some of the specialist suppliers to the process industries.

The last year saw all the major DCS and process control systems suppliers re-assess their business positioning, in the face of the turndown in capital spending as a result of the continuing recession and fall in commodity prices, led by oil. Their problem is that their main business cycles between feast and famine, as it is dependent on investment project business. Harry Forbes of ARC Advisory Group notes that automation companies will do nearly anything to protect their installed user base, because that’s where they believe future revenues will come, and come more easily than winning projects. So the way to survive the famine is to provide on-going services to these asset owners, to maintain the business relationship, and be better positioned when capital investment returns. Plus they stop competitive suppliers gaining a foothold via similar service contracts.

The current area of interest for most manufacturing plants is IIOT, and so the automation vendors have been focusing on this, plus Big Data and analytics, offered by remote ‘cloud-based’ services. The different suppliers come from different market positions, and so their approaches, while offering the same, are tailored in different ways.

Emerson Automation Solutions

Peter Zornio of Emerson expressed his very clear view of this market back in April at their Global User’s Exchange in Brussels. Emerson is involved in the IIOT: this does not include the ‘Smart Cities’ that Siemens and ABB talk about, nor Industrie 4.0, which extends from production back up into design concepts – IIOT is just ‘Manufacturing’. I believe Emerson also recognise that their process control systems cannot be a part of IIOT, they must be fenced off, with firewalls etc, to prevent cyber-security worries, and blocked from external inputs. But this does not stop them transmitting information outwards, and the whole Emerson approach of ‘Pervasive Sensors’ – their major new topic for 2015 – is now an important feed, into IIOT analytics.

The resulting offering is a cloud-based service developed in co-operation with MicroSoft, using their Azure IoT Suite of cloud services. Having worked with MicroSoft for over 20 years, their Windows 10 IoT technology will be incorporated into both the DeltaV and Ovation control systems and in data gateways to serve plant data to the Azure IoT Suite. Emerson will then provide the data analysis services that feed back information and recommendations to the relevant plant personnel, for example about plant performance or equipment maintenance. Zornio described this as a remote service similar to the ‘Monitoring Centre’ typical of the electricity generation industry, or the ‘iOps centre’ typically described in the oil and gas industry – which shows the areas of focus for the Emerson control system business.

Since then, Emerson restructured their widely separated divisions, Process Management and Industrial Automation, into one business, Emerson Automation Solutions, under newly appointed president Michael Train. This brings in some of the factory automation aspects covered by the old Industrial Automation Division, and extends the potential for the same IIOT monitoring into other areas of the manufacturing plant, such as power supplies, packaging and even discrete manufacturing. However, as part of their restructuring, Emerson has sold off significant parts of what was their Industrial Automation business, bringing in significant amounts of cash. In December the Network Power business, serving mainly data centre and telecommunications customers, was sold to Platinum Equity for $4Bn: the business will be rebranded ‘Vertiv’. Then, just this month, the deal to sell the alternators, drives and motors businesses known as Leroy-Somer (France) and Control Techniques (UK) to the Nidec Corporation was finalised: their combined annual sales were $1.7Bn, but of more relevance now to Emerson, the resulting cash payment received from Nidec is $1.2Bn. So Emerson Automation Solutions has probably earmarked part at least of that $5.2Bn of cash for some interesting, relevant acquisitions, maybe in this IIOT services area.

Rockwell Automation

Rockwell Automation has a totally different customer profile, perhaps the reverse of that described for Emerson, having great strength in factory automation, food processing and discrete process control in general. Their product portfolio is strong on motor control, actuators, energy management etc, using Ethernet based systems and controllers, which give simple interfaces to remote data systems. Steven Meyer of SAIC reported that the Rockwell South African MD Barry Elliot commented at the Electra Mining Show that the challenge is ‘to do more with the assets the organisation already owns’. He added that “In most cases the data already exists: our challenge is to implement systems that enable us to turn this into actionable information to streamline productivity and efficiency”. Just what the customer audience wanted to hear.

In November Rockwell launched their ‘FactoryTalk Analytics for Machines’ cloud application, based on – the MicroSoft Azure cloud enabled capability – yes, them again! OEMs using Rockwell/Allen Bradley controllers on their machinery can embed a FactoryTalk Cloud gateway device, to interface to this Rockwell remote analytical service.  Back at corporate level, the new Rockwell CEO is Blake Moret, and his attention is also on developing the oil and gas process systems business that was actually doing well in Rockwell, but is smaller than that of rivals like Emerson: so he has acquired Maverick Technologies, one of their system integrator customers. First this give Rockwell access to the Maverick five years of experience in supplying remote operations support as a service. Second, Walt Boyes of the Industrial Automation Insider has pointed out that Maverick has craftily recruited many otherwise retiring process experts from such companies as Dow, DuPont, ExxonMobil and other first tier companies, amassing a couple of hundred very valuable grey heads with continuous process management expertise. These are very useful for remote service support and advice, supplied even from their retirement homes!

ABB and IoTSP

Maybe ABB will have an alternative approach? ABB has a concept described as the Internet of Things, Services and People (IoTSP). They last year joined the Steering Committee of the Industrial Internet Consortium, an organisation founded by AT&T, Cisco, General Electric, IBM, and Intel in 2014. Then in September they recruited Guido Jouret as their ‘Chief Digital Officer’ – he was at one time the General Manager of the Cisco ‘Internet of Things’ division. October, however, brought them back into line with Rockwell and Emerson, when their new ABB Ability offering was announced as standardised on MicroSoft Azure, “expanding the ABB leadership in energy and the fourth industrial revolution”: ABB will take “full advantage of Azure services such as Azure IoT Suite and Cortana Intelligence Suite to capitalise on insights gathered at every level from device, to system, to enterprise, to cloud”. Although ABB say they have had many years of successful collaboration with MicroSoft, from the website it appears Ability is a new venture – looking for applications in transport infra-structure, digital power substations, fleet management services, Smart buildings etc.

Yokogawa

Yokogawa started 2016 with two acquisitions, first ‘Data-as-a-Service’ provider Industrial Evolution Inc, who provide cloud-based plant data sharing services, followed by KBC Technologies, who specialise in offering oil and petrochemical production plants the advanced software needed for process optimisation and simulation. These two were combined to create their new Industrial Knowledge Division. Executive vp Satoru Kurosu commented that “Key strategic objectives of Yokogawa’s Transformation 2017 plan are to expand the solution service business, focus on customers, and co-create new value with customers through innovative technologies and services”.

They then followed up with a strategic investment in FogHorn Systems Inc, a Silicon Valley specialist in fog computing – said to be the solution to faster processing of IIOT data present in the cloud. At the year-end, Yokogawa made a further significant investment into IIOT technology, first with a $900k investment into Bayshore Networks, who specialise in cybersecurity, and have developed the Bayshore IT/OT Gateway for use in the cloud, separating IT Departments from OT (Operational Technology) infrastructure networks. More than that, Yokogawa announced the establishment of a new Architecture Development Division in California, to pursue the development of the core technologies needed to establish the robust and flexible architecture required to improve operational efficiency and productivity when using the IIoT. Their aim is to expand this US engineering centre to over 50 staff in the next five years.

In February 2017 Yokogawa published their own release describing how these businesses will work together, and introducing another co-operation with Telit IoT Platfoms LLC, who are said to offer “offers unmatched expertise, resources, and support to make IoT on-boarding easy – reducing risk, time to market, complexity, and costs for asset tracking, remote monitoring and control, telematics, industrial automation, and predictive maintenance across many industries and vertical markets worldwide”. The most interesting aspect of their approach is that they seem to be moving towards “Plug-and-play” technology expanding to enable sensors to automatically join and adapt to plant networks, plus cloud reporting and condition monitoring, making the plant engineer’s job a lot simpler!

Obviously Yokogawa have major ambitions to develop and offer IIOT cloud data services with the best in technology and cybersecurity, all with a reduced customer detailed input.

Developments in South Africa

With so many major suppliers stepping up to offer cloud based IIOT data analysis and reporting services, what do the plant managers do? Steven Meyer’s report on the recent conference on the topic organised by the African branch of the Manufacturing Enterprise Solutions Association highlighted the recent PricewaterhouseCoopers report showing that South African companies plan to spend around R6Bn per year, until 2020, to implement the ideas of the fourth industrial revolution. In a keynote speech, local PwC director Pieter Theron made the telling comment that companies will need to find the right collaboration partners in order to improve their business efficiency through the technologies of the fourth industrial era – very few have the capability to go it alone.

These comments ring true for many large businesses all around the World: and it is clear that there are several interesting potential partners for these potential IIOT users to evaluate!

©Processingtalk.info

Regular educational reading?

The regular eNewsletter from the UK journal HazardEx should be compulsory reading for any process engineer: it always restores your faith in the incompetence of the human race when doing any project, and confirms that if anything will go wrong, it will do! There must have been someone’s law that said that.

Choose a relevant report to your industry from the fascinating selection in the current January 2017 issue, available from www.hazardexonthenet.net:

1. A Tesoro Logistics oil pipeline spilled 20,600 barrels of oil back in 2013, at a site near Tioga, North Dakota. Four years later the clean-up is still continuing, and it is likely to go on throughout 2017. Another spill of shale oil was discovered on December 5^th by a landowner near Bellfield, North Dakota. There’s a lot of space in North America, but this bit seems to have collected 4200 barrels of oil, apparently from a pipeline owned by Belle Fourche, part of True Companies of Wyoming. The relevant Administration has issued a corrective notice, lets hope that will be completed inside five years!
2. In Shaanxi province, China, a public toilet in Yulin City exploded on January 1st, killing one person and injuring seven others. Presumably someone lit a cigarette, and ignited an explosive build-up of sewer gas present in the building, which collapsed following the explosion.
3. An explosion at the Airgas plant near Pensacola, Florida last August unfortunately killed one worker: the explosion destroyed two tankers and a large tank storing nitrous oxide. The unexpected consequence was a country-wide shortage of canned whipped cream and other popular toppings over the Christmas break – obviously much more important to the US public! (These cans use N2O as a propellant and preservative)
4. The explosion at the GlaxoSmithKline Irvine plant in Scotland in July 2013 injured two employees: SmithKline Beecham Ltd pleaded guilty to H&S failings and was fined £55,000 in court in December 2016.

Platon/Roxspur acquired by TT Electronics

It’s always interesting when your old company gets taken over, once again! Particularly when you thought it was being screwed up, by the acquirers. So I was disappointed to have missed a news release nearly 15 years later, about a subsequent take-over in 2014.

The event was that Roxspur Measurement & Control was acquired by TT Electronics for GBP8m in July 2014. The good news was that the TT annual report for 2014 suggested that Roxspur provided a GBP0.4m operating profit, included in their results at the end of 2014.

Roxspur was absorbed into the TT Electronics Industrial Sensing and Control division,  which had a sales revenue of GBP61m in 2015, and an operating profit of GBP11.4m. So Roxspur is now a small-ish cog in this much bigger wheel.

TT Electronics describes itself as manufacturing a comprehensive range of temperature, pressure, flow and level products designed for aerospace, industrial, oil and gas, power generation and water management applications through its Roxspur sub-brands Brearley, Platon, Sensit and Nulectrohms. The TT Electronics total sales revenue in 2015 was reported as GBP524m, with an operating profit of GBP30m. So Industrial Sensing and Control is in fact a very significant part of the whole.

I, and everyone else, have to hope that the succession of acquisitions that were imposed on the Platon  variable area glass and metal tube flowmeter measurement business after 1999, have brought some of the employees some benefit.  Over the previous 8 years the Basingstoke based team had built the flow measurement business, which included the well known pre-Internet Flowbits catalogue, into a GBP10m business. So this small part of the corporate group at that time was probably worth more than GBP8m. It faced the biggest business trading profile challenge ever, with the arrival of the Internet, just as it was hyped into a broader paper based catalogue for industrial engineers, renamed as “Controlbits” by the new acquirers.

There are still paper catalogues around, in 2016, but hyped up earnings expectations appeared to kill off the Platon catalogue. The chaos catapulted me, after a year recovering from being made redundant, into a new career, which I do not regret. It also spawned some spin off start-up companies, which have done well. Even the Platon Pension scheme, which had to be the subject of a Government funded rescue, has at last started to pay out some of the pensions due, as from 2015.

So there were benefits! Ironically I did, at that time, and maybe still have, a minimal number of shares in TT Electronics!

 

First New ProcessingTalk Newsletter issued!

ProcessingTalk.info has sent out the first newsletter from Nick Denbow’s Automation blog, giving information for Engineers, Marketing and Sales Managers about the latest developments in process automation, instrumentation and control solutions, plus recent applications and acquisition news, taken from news releases and press events.

You can read the first issue, and subscribe for future mailings, planned for every month as an update on the latest month’s news, free of charge on this Mailchimp website: http://eepurl.com/bQaWJf

Alternatively subscribe to @ProcessingTalk, or consult http://www.Processingtalk.info regularly!

Changes at the Emerson PR Agency for Europe

Two years after the untimely death of Charles Lewis, the PR agency he founded, HHC Lewis, has continued its successful business relationship with a varied client list, one of which is Emerson Process Management. For around 20 years a team at HHC Lewis in Southampton has acted as the PR and advertising agency for Emerson across Europe, producing copy for editors under the guidance of US and European marketing, and ensuring a consistent advertising presence in published material. For the last two years the Emerson team and external responsibilities have been headed up by Adrian Chesney.

Cherie Pearce and Adrian Chesney

Now Adrian Chesney and Cherie Pearce, previously the Company Accountant, have led an MBO and are the new joint managing directors. Nick Taylor, Marketing Director for Emerson Process in Europe, is pleased to see HHC Lewis moving forwards, and hopes their excellent working relationship will continue in the future.

Pearce and Chesney bought the business without outside funding, having acquired the shares from the previous owner. They are now the company directors and joint owners and will lead the business. Chesney joined the agency seven years ago as a PR account manager and Pearce has been with the company since 1995.

Chesney said: “We are delighted to have the opportunity to guide the direction of HHC Lewis and enhance the enormous potential of our company. The HHC Lewis team has a wealth of experience and continues to develop innovative ways of serving our clients.”

Earlier this year the Agency relocated from offices adjacent to the Mayflower Theatre in Southampton, to a new office block in Southampton town centre. Other contact details remain the same.

Spitzer and Boyes to acquire the INSIDER

The press release below will be of interest to readers of the INSIDER pdf subscription newsletter, which I have edited since 2010, following on from the founder and editor for 14 years, Andrew Bond. I will still continue writing articles for the INSIDER from a European viewpoint, but the publication will benefit significantly from the US input available from Walt Boyes.

“We are pleased to announce that effective with the February 2014 issue, we have acquired the Industrial Automation and Process Control INSIDER,” said David W. Spitzer, PE, principal of Spitzer and Boyes LLC. “Walt Boyes, formerly award-winning editor in chief of Control and controlglobal.com will assume the editorship with the February issue.”

Nick Denbow, respected as one of the best automation industry editors and journalists in the world, will relinquish the publisher role, but will remain as UK/Europe editor indefinitely. “Joining editorial forces with Walt gives a real opportunity to share opinion and inputs from both sides of the Atlantic – which is exactly what the vendors already do. It will be really exciting to see the INSIDER expand in this way,” Denbow said.

“We chose the INSIDER for a number of reasons,” Boyes revealed. “First, as a subscription-based publication, it is not competitive to any of the other automation magazines, which are all advertising-supported. The INSIDER will continue to be subscription-based and will not sell advertising.”

“Second, we felt that the INSIDER has the reputation of exceptional, hard-edged journalism that we wanted to be associated with,” Boyes continued. “For over seventeen years, first under the direction of Andrew Bond, and then under Nick Denbow, the INSIDER became and has remained one of the most read and authoritative publications in the automation industry.”

“Third, we have plans to enhance and improve the excellent reporting and journalistic insight of the INSIDER beginning with the February issue,” Boyes said.

“We intend to provide local reporting on a global scale, beginning with North and South America. We intend to have Pacific Rim, India, MEA and Eastern European reporting to complement the terrific job Nick’s done primarily in Western Europe and the UK,” Boyes said.

“Beginning in the February issue, there will be an editorial by me,” Boyes said, “and beginning in March, a feature column by Joy Ward that will normally be an interview with an automation luminary, either vendor or end user.”

“There will be increased coverage of end user activities, as well as more in-depth coverage of vendor news from around the world,” Boyes added.

“We’ll have more news about the plans for the INSIDER in the coming months,” Boyes said.

The Industrial Automation and Process Control INSIDER  (www.iainsider.com) is the authoritative publication in the automation market space. Because it is subscription-based, not advertiser-supported, it publishes news, opinion and analysis about the automation industries without fear or favor.

Spitzer and Boyes LLC (www.spitzerandboyes.com) is a technology consulting firm devoted to assisting companies to better create and market their products in manufacturing and automation. David W. Spitzer, PE and Walt Boyes are the principals of the firm. Spitzer and Boyes LLC provides technology transfer and due diligence services for mergers and acquisitions in the technology environment, new product development consulting and forensic engineering for technology cases, content creation and custom research services in the manufacturing and automation space.

More information can be obtained from  editorial@iainsider.com or dspitzer@spitzerandboyes.com.

Insider review of Schneider bid

The main story in the August issue of the Industrial Automation INSIDER Newsletter is a review of the Schneider Electric $5+Bn bid for Invensys, as shown below. Plus other articles discuss the spin off of the old Valmet from the Metso Group in Finland, and developments from Krohne, including the NIR spectrometer developed by Bayer for their chemical plants, and the intergrated HART transmitters in the Krohne SmartSens pH and conductivity analytical sensors.  Other news from ABB, Yokogawa, and Offshore Europe, plus reports about Innominate mGuard firewalls, Wipro water industry ambitions and HMS Anybus interfaces enabling machinery to communicate with any plant network, such as Profinet, DeviceNet etc. For subscription information please see http://www.iainsider.co.uk

Schneider justifies $5Bn price tag for Invensys: sees automation and power as good fit to expand offering

Jean-Pascal Tricoire, the chairman and ceo of Schneider Electric, had a comprehensive presentation prepared to explain their interest in acquiring Invensys, on the day of the meeting scheduled for discussion of the Schneider half year results, on 31st July. Tricoire announced their intention to acquire the Invensys group on terms similar to those outlined earlier in the month by the Invensys statement, and announced the backing of the Invensys board, backed by formal undertakings from each of them to sell their individual personal and family share-holdings to Schneider.

Elsewhere in this newsletter  the build-up to the offer, following the Invensys disclosure of the on-going discussion with Schneider, is described.

The logic for the deal 

The Schneider offer document describes themselves as ‘The global specialist of
solutions integrating power and automation technologies to help customers
manage energy and drive efficiency’. It then adds – ‘Operational efficiency is further
driven by software, as Information Technologies (IT) and Operational
Technologies (OT) converge’. This IT/OT link is a major piece of their logic for
wanting to acquire the Invensys automation businesses.
Schneider explain: “in the industrial and infrastructure end-markets, integrated solutions, combining power and automation technologies, drive operational efficiency. Industrial automation is an attractive growth market per se. The integration of automation and power offerings – supported by low voltage, medium voltage and critical power technologies, a key strength of Schneider Electric – will enable a new level of performance. Such integrated solutions are especially relevant to e l e c t r o – i n t e n s i v e customers. Operational efficiency is further driven by software capability and connectivity skills, as IT and OT converge.”

“Schneider Electric believes the businesses of Schneider Electric and Invensys to be highly complementary to respond to these business trends, with the combination representing a unique opportunity to create a global leader in industrial automation, advanced software solutions and power solutions. This will enable the enlarged group to offer a broader range of systems and services to new and existing clients.”
Due diligence and benefits Throughout the analysts’ questions Tricoire maintained that the feedback from their own customer base had been that Invensys was the right partner, for Schneider to link with, and that undoubtedly the two companies were
complementary, Schneider bringing the power management and electrical interface
to enable a total electrical project capability. The only criticism heard of Invensys was that the group was not seen as financially stable, in the longer term, but this would be solved by an acquisition by Schneider.
In addition the Invensys presence in process automation markets complements the Schneider market presence with strength and penetration in the discrete and hybrid automation areas. The integration of Invensys with the Schneider industry business will increase the share of revenues derived from solutions and services from 24% to 40%, decreasing the percentage attributed to product sales. Schneider see this as a good thing, increasing the share of recurring and high added-value revenues for the business. They also see a positive benefit in the change to the cyclical profile of the business, increasing significantly the share of revenues from long cycle activities!
Financial benefits 
In financial return figures the acquisition is forecast to give Schneider the extra benefit of cost savings of around Euro140m by 2016 from the current Invensys operational cost level, plus increased revenues of around Euro400m by 2018 as a result of the larger offerings from the group, leading to additional earnings of Euro65m per annum, on top of the existing Invensys earnings rate. In year 3 Schneider see return on capital (after tax benefits) of 10% to 11%. The future of the Invensys Appliance segment within this has not  been considered as yet.
Areas with strong brands Schneider sees Invensys as having strong brands and presence in the automation market, and were obviously keen to add their power solutions alongside the Invensys industrial automation and advanced software. So their comments in relation to Foxboro (DCS and equipment), Triconex, Wonderware, SimSci and Avantis seem to indicate that these would continue as the lead for Schneider in their market areas, bringing forward Schneider power equipment, SCADA presumably, and PlantStruxure PES systems as appropriate – good news for Mike Caliel and his industrial automation business area. Tricoire said that his due diligence teams had been impressed with the people they had met in their discussions, with solid teams, on top of their projects.
The future?
For Invensys the deal with Schneider looks positive: the shareholders also get a good deal.

For the industry the deal would retain Invensys as a separate independent DCS and automation software supplier, claimed by Schneider as #3 in terms of installed base. This is also good news for journals and newsletters, like the INSIDER. The deal will also add a strong electrical services supply arm, making Schneider+Invensys compete almost on a par with ABB and Siemens. Then, with Schneider a dedicated Ethernet enthusiast, maybe the two together will also develop into a new discrete and hybrid supplier, competing for the typical Rockwell clients.

For Emerson, Honeywell and Yokogawa, they lose a weaker competitor, and miss out on acquiring, or future scavenging on, the significant installed base of Invensys systems. They gain a rejuvenated competitor, with strong asset backing, wanting to re-take their place at the table. We have yet to see if anyone else thinks this place at the table is worth fighting for, as there are still three months to go before the name is changed forever.