Munich, Germany–Siemens AG has announced the acquisition of Dotmatics, a leading provider of Life Sciences R&D software, for $5.1 billion from Insight Partners.
This strategic move marks a significant step for Siemens, as it expands its market-leading AI-powered software offerings and extends its footprint in the Life Sciences sector. The acquisition strengthens Siemens’ position in industrial software, incorporating Dotmatics’ advanced R&D tools and scientific data management capabilities into Siemens’ renowned Digital Twin technology and AI-powered Product Lifecycle Management (PLM) software portfolio.
A Transformative Acquisition
Dotmatics, based in Boston, offers a suite of scientific applications and data management solutions designed to accelerate drug development and innovation in Life Sciences. Its platform empowers customers to manage multi-modal data and collaborate seamlessly, driving breakthroughs in areas such as drug discovery and development. The acquisition will enable Siemens to integrate these capabilities into its existing offerings, creating a unique AI-powered digital thread that spans from R&D through to manufacturing.
Roland Busch, President and CEO of Siemens AG, emphasized the transformative potential of this acquisition. “By acquiring Dotmatics, we’re strategically strengthening our position in Life Sciences and creating a world-leading AI-powered PLM software portfolio as part of Siemens Xcelerator,” said Busch. “Artificial Intelligence is transforming industries, and its application in Life Sciences is increasingly critical. This acquisition is part of our broader strategy to accelerate customer innovation and enhance Siemens’ leadership in industrial software.”
Strengthening Growth and Innovation
The acquisition of Dotmatics aligns with Siemens’ goal to drive innovation in industries with high R&D spending, such as Life Sciences, which represents a rapidly growing market. The sector is expected to see a surge in digital transformation, driven by factors like aging populations, growing access to medicine, and advances in scientific research. As software spending in Life Sciences is projected to double in the next five years, Siemens is positioning itself to capitalize on this growth.
Siemens’ CFO, Ralf P. Thomas, highlighted the financial upside of the deal. “Dotmatics is a highly profitable and cash-generative business. This acquisition will drive substantial revenue synergies, and we expect to see medium-term synergies of around $100 million per year, accelerating to over $500 million annually in the long term,” Thomas stated. “Financing for the acquisition will primarily come from the sale of shares in listed companies, including Siemens Healthineers.”
A New Chapter in Scientific Innovation
The acquisition also brings significant benefits for Dotmatics. Thomas Swalla, CEO of Dotmatics, expressed excitement about the new partnership with Siemens, noting the complementary strengths of the two companies. “Combining our next-generation scientific intelligence platform with Siemens’ Digital Twin and AI capabilities will drive a new wave of innovation in life sciences R&D,” Swalla said. “Together, we’ll accelerate innovation cycles and help scientists make breakthrough discoveries faster than ever.”
Expanding Market Opportunities
With Dotmatics, Siemens expands its industrial software total addressable market by $11 billion, tapping into a dynamic and growing segment within Life Sciences. The market for Life Sciences R&D software is driven by key structural shifts, including increased demand for healthcare solutions, new treatment options, and the need for improved collaboration across complex global value chains. As the market undergoes a digital transformation, Siemens is positioning itself to meet the rising demand for innovative software solutions.
Financial Outlook and Future Prospects
Dotmatics is expected to generate over $300 million in revenue for Siemens in fiscal year 2025, with a high adjusted EBITDA margin above 40 percent. The company’s strong growth and profitability will provide an immediate boost to Siemens’ financial performance. Over the long term, Siemens anticipates substantial revenue synergies, contributing to the company’s overall growth, EBITDA margins, and free cash flow.
The acquisition, which is part of Siemens’ ONE Tech Company growth program, underscores the company’s commitment to expanding its market position through strategic investments. This program also includes recent acquisitions like Altair, further advancing Siemens’ capabilities in AI-enabled products, software, and connected hardware.
The transaction is expected to close in the first half of fiscal year 2026, pending customary closing conditions and regulatory approvals.
