The companies will combine under the UGS name to become EDS's fifth line of business. Unigraphics President and CEO Tony Affuso will become president of the new business.

EDS will pay a premium of 42% over SDRC's closing price yesterday or $25 a share.

“In the last 24 months, we have seen the beginning of a network-based revolution in the way products are designed, developed and manufactured,” said Dick Brown, EDS chairman and CEO. “UGS has given us a window on this change and on the emergence of product lifecycle management, where digitized information is shared instantly and globally. Now is the time to move quickly and decisively to capture opportunities in this space.”

Brown noted the SDRC acquisition would bring EDS 7,000 clients, 85 percent of whom are new to EDS, and greatly expand relationships with companies including Ford, Mazda, Honeywell, Nissan and Nokia.

“Most importantly, we gain substantial software capability in a rapidly emerging market with significant ‘pull-through’ revenue for services from our other four lines of business,” Brown said.