Stuttgart and Hong Kong, November 6, 2019. RIB Software SE, the global leading provider of iTWO 4.0 cloud enterprise platform technology for building and infrastructure industry, today announced the successful signing of a convertible loan agreement with SoftTech Engineers Limited, a publicly listed software company on the National Stock Exchange of India. Under the terms of the agreement, RIB provides SoftTech with a loan of up to US$ 2 million with the right to convert into shares within the next 18 months.
The agreement underscores RIB’s commitment to its 2 million user target for the MTWO platform and iTWO 4.0 technology. Being the 12th out of 14 M&A deals planned by RIB Group this year, SoftTech is the 4th M&A undertaken swiftly in India, the country with the second largest population in the world. The SoftTech investment follows RIB Group’s investments in Levtech, Winjit and Capricot in 2019, thereby consolidating its market position in Asia-Pacific as a formidable player in the AEC (Architecture, Engineering & Construction) automation Industry segment.
The uniqueness of SoftTech stems from the fact that it's one amongst highly differentiated AEC automation firms worldwide. By providing an automated building plan Approval Management system as precursor to BIM, the software products effectively reduce cost and time required by architects and government authorities in mapping building codes and delivering approvals for construction. Integration of Auto (2D) and BIM (3D) Development Control Rules (DCR) also known as building codes into the pre-construction phase is a humongous task of eliminating manual operating procedures achieved by SoftTech Engineers Limited, which has offices in US and Finland with over 550 employees in India.
Apart from its core offerings, SoftTech also sells PWIMS (Public Works Information Management System) – an ERP for government run municipal corporations, which in turn features as OPTICON for the private sector (ERP for General Contractors & Developers/Project Owners). SoftTech is currently working on “Rule Buddy” - an algorithmic engine for mapping building codes based on Machine learning & Deep learning approach (AI). Having consolidated 80% of market share with respect to state government accounts in India, SoftTech attempts to replicate its business model in Virginia (US) with the Federal government, while developing cutting edge innovation in Helsinki, Finland. Founder & CEO – Vijay Gupta, is an engineer inspired by Technology innovation. SoftTech has its headquarters at Pune, India and is an addition to public sector/government AEC segment for RIB Group.
SoftTech’s proprietary suite of software solutions read 2D or 3D CAD drawings, as well as BIM files, and automatically map them onto government building regulations. Since last five years, the company has consistently achieved EBITDA margins exceeding 20% on double-digit compounded annual revenue growth.
With several innovative, cloud and machine learning offerings, as well as ample growth potential for its products in India and abroad, SoftTech stands poised to benefit from India’s plan to develop more than 100 smart cities, as well as the global push to digitize and automate building plan approval processes. In the near future, SoftTech plans to enhance its existing 20,000 user base through new products and rapid international expansion.
Via the agreement, RIB and SoftTech solidify their joint commitment of digital transformation in the AEC industry. The two companies promise to concert their efforts in driving 21st Century state-of-the art innovation for construction and building permit approvals. RIB will be represented on the board of SoftTech in order to envision strategic alignment.
This mutual synergy will enable SoftTech in establishing a global footprint for government run construction automation while harnessing economies of scale and uplifting its Earnings per share. At the same time, RIB gains superior competitive advantage by incorporating a unique product into its MTWO/iTWO portfolio globally.
Vijay Gupta, Chairman and CEO – SoftTech Engineers Limited: “Ever since the foundation of SoftTech, more than 20 years ago, we have been working on the transformation of AEC industry. With RIB, we are aligning ourselves with a larger organization that can help us achieve our strategic goal of international expansion and growing our user base. Our existing and next generation products are intelligent, cloud-based and collaborative and fit perfectly into RIB’s MTWO platform strategy.”
Tom Wolf, CEO - RIB Software SE: “The automation and digitalization of building permits represents a huge opportunity for the AEC industry to increase efficiency and speed of execution. With our iTWO technology, we look at the construction process holistically and we are proud to have found in SoftTech a cutting-edge innovator for transferring 2D or 3D CAD based drawings digitally into building approvals. SoftTech’s solutions are key building blocks in our MTWO platform strategy to offer innovate SaaS solutions to our clients.”