RALEIGH, NC—Raleigh software firm I-Cube cruised down the information highway with 35 percent year over year growth it fueled with profits, but “To really take things to the next level and grow faster, we needed capital investment,” says Donald Thompson, CEO. The company sold its product lifecycle management (PLM) business to India-based KPIT for up to $24 million it announced today.

Product lifecycle management is the process of managing a product from inception, through engineering design and manufacture, to service and disposal of manufactured products. It integrates people, data, processes and business systems.

“We weren’t actively looking to sell the company, we were looking for strategic partnerships,” Thompson told WRAL TechWire. After a year’s worth of negotiations that included KPIT, however, the two companies saw synergies they felt would mesh excellently. “It’s a particularly good match,” Thompson said in an interview with WRAL TechWire.

He added, “The more KPIT got to know us, way we work with NC State, the way we’re able to groom Gen-Y folks in their first or second job into premiere consultants over a few years, they really became interested in acquiring the business:” KPIT also liked the company’s move into engineering and analytics and its recent acquisition of Chicago-based Akolya, which further enhanced its already robust big data technologies.

It also has It has strong partnerships with PTC, Autodesk, Oracle and Siemens, which KPIT acknowledged in an investor release that discussed the acquisition. The document notes that the PLM part of I-Cube’s business had $10 million in revenue with an EBITDA of 13 percent.

I-Cube also saw advantages.

No layoffs coming

“It’s good financially, good for our employees who can grow their careers,” said Thompson, “and good for our customers, because we’ll be able to offer a much stronger portfolio of services. We’ll be able to go after larger accounts.” The deal includes a guaranteed payment of $14.15 million, $12 million up front and the rest in six months. The company could get an additional $10 million based on performance over three years.

The company, based on NC State University’s Centennial Campus, where it will stay after the acquisition, was founded in 1984 by Grant Willard who left when Adobe bought a piece of the company’s technology close to a decade ago.

It fostered an entrepreneurial couture despite being in business for a quarter of a century. In 2012, Thompson says, it created ICI Digital, which specializes in high web profit management with three or four people and it quickly expanded to 40. Temporarily, Thompson remains CEO of ICI, which KPIT didn’t buy. It will spinout on its own.

Thompson will soon transition to the I-Cube subsidiary as VP of PLM in North America. About 80 of I-Cube’s employees will stay with the new subsidiary while about 40 go with ICI Digital. No employees will be laid off due to the acquisition.

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I-Cube

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KPIT Investor Release