B2B Business Network technology provider E2open and global trade technology support provider Amber Road today announced that they have entered a definitive agreement for the acquisition of Amber Road in an all-cash deal valued at approximately $425 million.
Under the terms of the agreement, a subsidiary of E2open will commence a tender offer for all the outstanding shares of Amber Road common stock for $13.05 per share in cash. The Board of Directors of Amber Road has unanimously approved the definitive agreement and recommends that shareholders tender their shares in the tender offer. Upon closing, Amber Road will become a privately held company.
This latest acquisition announcement comes on the heels of E2open’s October announcement relative to the acquisition of INTTRA, a prominent B2B ocean shipping network, software and information provider. The combination of INTTRA’s ocean carrier and shipper network with E2open’s industry business network platform was targeted to create a unified global logistics and supply chain network and streamline the information flow between manufacturers, suppliers, shipping service providers, ocean carriers and all the participants in global trade. The INTTRA acquisition followed the acquisition of Cloud based TMS systems provider Cloud Logistics that same month.
This subsequent agreement to acquire Amber Road adds to the potential of such broader capabilities and deep pockets driving such an M&A strategy.
In February of last year, Supply Chain Matters shared with readers what we termed as some Wall Street focused drama occurring in the supply chain management B2B Business Network technology area. That drama was a prior unsolicited takeover attempt by E2open for Amber Road. Unfriendly takeovers were at the time, not the purview of the supply chain management technology landscape, nor was the drama played out in business media.
At the time, E2open and its private equity parent Insight Venture Partners, publicly disclosed an unsolicited proposal to acquire all outstanding shares of Cloud based global trade management technology provider Amber Road that E2open did not already own for tender price of $10.50 cash per outstanding share. According to the public release, the proposal last year represented a 52 percent premium to Amber Road’s closing stock price on February 9th, 2018, and a 41 percent premium over to Amber Road’s 30-day average trading price.
By our view in February 2018, Amber Road provided a significant opportunity in that it could provide the ability to compete head-to-head with Infor’s GT Nexus transportation and global trade network platform.
The Board of Directors of Amber Road wasted little time in confirming that it had received the unsolicited offer, and unanimously concluded that it was not in the best interest of the Company’s shareholders to pursue the proposed combination at that time. That battle lasted for several months before being announced as unsuccessful.
According to today’s statement provided by James Preuninger, Chief Executive Officer of Amber Road:
“The combination of E2open’s supply chain and logistics technologies with Amber Road’s global trade management platform will also allow customers to more fully digitize their operations and better compete in global markets. The deal will also deliver an excellent return for Amber Road’s shareholders, as the $13.05 price per share being paid by E2open represents roughly a 45% premium to Amber Road’s 90-day average closing price.”
Obviously, both management teams came to some meeting of minds in the subsequent 15 months.
Supply Chain Matters Initial Perspectives
Once again, as with all things related to E2open, each of a series of acquisitions are a component of a broader consolidation strategy that is being orchestrated by private equity owners Insight Venture Partners.
Amber Road was the prize established last February, and now is part of a broader integration of Cloud-based B2B Business Network platform bringing together end-to-end planning, supply chain analytics and decision-making, supply chain logistics, transportation and potentially last-mile fulfillment. Add in other acquisitions related to supply chain and sales and operations planning (Steelwedge), Channel Management (Zyme), Analytics (Orhestro and Terra Technology), and others, a very broad picture of capabilities comes into view.
As always, such a track record of acquisitions comes with a challenge of overall integration and the impacts to existing customers of each of the acquired platform providers and to E2open’s existing multi-industry customer base.
We will reserve judgement and added commentary until after the latest acquisition, that of Amber Road, closes.
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