Australian logistics software developer WiseTech Global (ASX: WTC) has today announced the US$230 million (AUD$326 million) acquisition of US transport management system software provider Envase Technologies.
The deal, which comes just two weeks after WiseTech’s founder and CEO Richard White acquired UK-based Kyckr via his personal investment company for $44 million, will strengthen WiseTech’s position in the intermodal trucking and landside logistics space according to the company.
Headquartered in the US, Envase’s solutions for carriers automate and provide visibility for the movement of containers across all aspects of import and export haulage operations from port and rail terminals to destination.
Envase has more than 1,300 customers across North America, including trucking companies, ports, depots and warehouses, and is expected to generate approximately US$35 million of revenue this calendar year with an earnings margin in the low-to-mid 20 per cent range.
Sydney-based WiseTech says it will fund the acquisition via a combination of 70 per cent cash (US$161 million) and 30 per cent new WTC shares issued to private investment firm Firmament which currently owns Envase.
According to WTC - the operator of logistics software CargoWise - the cash component will be funded from existing cash reserves and the deal is expected to complete in February.
“This is a strategically significant acquisition in landside logistics, which extends and strengthens our position in one of our six key CargoWise development priority areas, and we’re extremely pleased to have the Envase team join the WiseTech Global group,” White said.
Envase CEO Larry Cuddy Jr said the deal was an ‘exciting development’, and would enable the target to make a bigger impact.
“Over the past few years, we have assembled an integrated a powerful suite of landside logistics solutions,” Cuddy Jr said.
“Combined with the strength and size of WiseTech and its CargoWise platform and depth in international logistics, we have a powerful platform that we expect to further increase capacity and utilisation and drive innovation in what is an intensely complex and highly fragmented ecosystem.
“The Envase team is grateful for the support of Firmament over the years and for their vision to establish Envase as a leader in landside logistics.”
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