The anti-competitive status of Aspen Technology’s 2002 acquisition of Hyprotech continues to exercise the Federal Trade Commission (FTC). Aspen acquired Calgary-based Hyprotech from AEA Technology back in 2002 for $99 million cash.
Hyprotech software helps companies model fluid flow in surface production facilities. The company has been involved with a couple of high-profile joint ventures—with Schlumberger units Baker-Jardine and Information Solutions. These combined offerings are at the heart of the emerging intelligent or integrated oilfield offerings, integrating facilities modeling with the reservoir simulator.
Federal Trade Commission
Last July, the FTC published a settlement proposal under whose terms AspenTech was to sell rights to the Hyprotech product line (excluding some products - notably the HySys Upstream and Asset Builder tools), together with its operator training business to an FTC-approved buyer. AspenTech would continue to sell and develop the engineering software products acquired from Hyprotech.
This proposal failed to impress certain of Aspen’s competitors. SimSci-Esscor, Linde AG and the French Petroleum Institute’s investment arm all objected to various aspects of the settlement during the 30 day public comment period. SimSci claimed that the settlement would fail to reduce Aspen’s dominant position in the market for process modeling. The exclusion of HySys (and its downstream equivalent RefSys) was a particularly sensitive issue for SimSci.
The French Petroleum Institute’s (IFP) objections likewise centered on the exclusion of certain Hysys-related products and services. The IFP was also concerned that the proposed order did not require AspenTech to ‘maintain compliance with open standards’ for its process engineering software. This, according to the IFP, might affect the ‘viability of applications using Hyprotech engineering software.’
$1 billion market?
ARC Advisory Group estimated the market for such solutions at around $1 billion annually. Read more on the role of the regulator in our editorial on page 2—and more on the Schlumberger/AspenTech joint offering in next month’s report from the Schlumberger Information Solutions 2004 Paris Forum.
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