WiseTech Global expands international logistics reach with US$2.1b E2Open acquisition

WiseTech Global (ASX: WTC) has announced the US$2.1 billion acquisition of US-based supply chain specialist E2open to create a multi-sided marketplace connecting asset-based carriers, logistics providers, importers, exporters and shippers.

The deal will add adjacent markets and product capabilities to WiseTech’s résumé and boost its client base with a network of 500,000 enterprises and 5,600 customers including more than 250 blue-chip companies.

WiseTech expects the acquisition to bring a strong complementary product suite that extends the company’s CargoWise software platform in the areas of domestic logistics, carrier integration, global trade and supply chain management.

Share consideration

WiseTech will pay E2open shareholders a consideration of US$3.30 per share that it will fully fund from a US$3 billion debt facility it has arranged through a syndicate of leading domestic and international banks.

At completion, liquidity for the combined business will total approximately US$0.7 billion from cash at hand and undrawn revolving credit, providing WiseTech with adequate funds to support its future growth.

The company anticipates the transaction will be earnings-per-share accretive in year one before accounting for business synergies.

Complementary markets

WiseTech founder and executive chair Richard White said the E2open acquisition presented an opportunity to acquire a scaled and profitable leading provider in adjacent and complementary markets.

“Acquiring E2open is a strategically significant step in achieving our expanded vision to be the operating system for global trade and logistics,” he said.

“It will enable us to create a multi-sided marketplace that connects all trade and logistics stakeholders to efficiently offer and acquire services, removing complex disconnected processes and driving visibility, predictability and cost savings through the value chain.”

Experienced team

The transaction will expand WiseTech’s product capabilities with an experienced team of people and innovative product development skills.

“In bringing our two companies together, we see tremendous opportunity for synergies, efficiencies, economies of scale and enhanced customer benefits, which unlocks the potential in E2open’s suite of products,” Mr White said.

“This is a great deal for WiseTech’s business, E2open’s shareholders, our customers, the industry and ultimately, the consumer.”