Almost a year to the day after announcing its acquisition of Control Specialists in the United Kingdom, HMS has agreed to acquire Pennsylvania-based Red Lion for $345 million. The acquisition is designed to strengthen HMS’ presence in North America and enable cross-selling of both HMS’ and Red Lion’s products.
HMS literally stands for "hardware meets software,” highlighting HMS’ focus on integration; however, no company stands alone in the market of industrial automation with just one value stream, notes Tobey Strauch, an independent principal industrial controls engineer in Fremont, California (Figure 1). “Purchasing Red Lion allows HMS a hardware-component entry to sell more HMS products in the United States via association and familiarization,” she explains. “This is a growing type of merger in the market for two reasons; increased Internet-of-Things (IoT) awareness by OT professionals and increased network and protocol usage in the OT arena, meaning software is going to grow.”
That growth will occur slowly because of the comfort level of OT people in the United States, predicts Strauch. “But eventually OT will become more software- and data-driven, and the companies that are set up with hardware and software will have a broader base to serve customers. Since HMS is an ‘any bus’ company, I would look for it enabling a hardware for open PLC communications,” she says.
The Red Lion offering is centered around three core product lines:
- Access products are designed to allow industrial end customers to get the most value out of their remote assets by offering enhanced cloud connectivity, edge intelligence and remote device management. This product line includes industrial gateways, protocol converters, routers and access points.
- Connect products are designed to protect and streamline communication between plant operators and their assets in a secure, reliable and easy way to maximize operating performance and system uptime, with Industrial Layer 1 and 2 Ethernet switches representing the main parts of this product line.
- Visualize products are designed to allow plant operators to acquire, manage and interact with their data to further optimize performance in challenging and harsh environments, with human-machine interfaces (HMI) and panel meters constituting the main products.
Red Lion’s Access products fit well with HMS’ Anybus and Ewon product lines, while Red Lion’s Connect offering adds what HMS has been seeking for several years—an Ethernet switch offer, says Dahlström. Finally, Red Lion’s Visualize offering brings new opportunities for HMS to explore data visualization opportunities that are becoming more interesting in the industrial-automation environment.
“We are eager to start working together and to realize the synergies between the companies and to enable each other to take the next steps on our common future journey once the transaction closes,” adds Dahlström.
Red Lion has four development sites, located in York, Pennsylvania; Mobile, Alabama; Dinkelsbühl, Germany; and Pune, India, as well as manufacturing sites located in York and Dinkelsbühl. Red Lion employs about 400 people globally, of which about 300 are in the United States.
