By Putting Together eVision And Enablon, Wolters Kluwer Reshapes Competitive Dynamics
Wolters Kluwer, the information solutions firm with €4.4 billion in revenue, today announced that it has acquired eVision Industry Software an operational risk management (ORM) software vendor for $145 million. eVision, which had $25 million in 2017 revenues and 225 employees at the time of the deal, will become part of the Enablon business unit led by Chris Joseph in the Wolters Kluwer Legal & Regulatory division led by CEO Stacey Caywood.
According to our recent market size and forecast report, the ORM software market is worth $1.3 billion in 2018 and is set to grow by 50% over the next 5 years to $1.9 billion in 2023. eVision has primarily focused on the petro-chemicals sector which accounts for 58% ($754 million) of spending on ORM software in 2018. In the recent Verdantix assessment of operational risk management software, we found that eVision offers one of the strongest permit-to-work applications and also has strong capabilities for barrier management, risk assessment, job hazard analysis and process safety management. Among the pure-play ORM vendors, eVision had the highest 2017 revenues.
This acquisition is definitely a case of 1+1=3 for Wolters Kluwer. Enablon and eVision have had a strategic partnership, co-selling their product and developing integration in real deployments, for several years. Whilst Enablon has successfully expanded its risk management functionality from its EHS-centric platform, it has primarily served the risk management needs of safety professionals. By contrast, eVision has sold to the VP Operations, Head of Process Safety and Offshore Installation Managers. These buyers have different requirements and much bigger budgets. By putting together the EHS-centric Enablon platform and the operations-centric eVision application, Wolters Kluwer will have a broad, proven, enterprise-scale offering from safe operations which will be difficult to replicate. With several deployments which integrate the two applications, customers should not be concerned about problems getting the systems to work together.
Verdantix has consistently argued that for EHS vendors to be successful selling to operations leaders a different product architecture is required and a go-to-market strategy which targets asset owners not EHS professionals. The reason? EHS leaders seek software which delivers safety improvements and controls environmental impacts without affecting operations. Operations leaders need software which enhances production whilst preserving safety. These are very different lenses. By putting together proven EHS and ORM applications, Wolters Kluwer has stolen a march on its competitors in a combined market worth $2.5 billion in 2018. This deal will trigger further acquisitions of pure-play ORM software vendors – most of whom have revenues below $15 million – especially since the market is shifting from smaller, facility-level deals to regional, business unit or global deals. Who will the buyers be? Whilst private equity is always circling fast-growing software vendors, Enablon’s EHS competitors will need to make an acquisition if they really want to compete in the ORM software market. In short, the gloves are off.