EDS Forms Product Unit

EDS Forms Product Unit

Electronic Data Systems Corp. plans to buy Structural Dynamics Research Corp. for approximately $950 million in cash, or $25 a share. SDRC will be combined with Unigraphics Solutions Inc. to form a $1 billion a year line of business that provides product life-cycle management software and services.

SDRC's product management software allows collaboration on product design over the Internet, speeding time to market and reducing development costs. UGS is a producer of product life-cycle management software.

UGS is publicly traded, but EDS owns 86 percent of the stock, having spun off the business in 1998. As part of the combination with SDRC, EDS is buying the outstanding shares of UGS for $27 a share or about $170 million.

Both transactions are expected to close on or about the end of the third quarter. EDS expects the new business will grow 16 percent to 20 percent annually over the next five years.

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