In August, ERP provider Infor announced that he had entered into an agreement to acquire supply chain logistics and commerce network provider GT Nexus for $675 million. This Supply Chain Matters posting provides updated information regarding the acquisition as a result of an analyst briefing held earlier this week.
At the time of the acquisition announcement in August, the deal was expected to close within 45 days, pending regulatory approval. On Monday, Infor informed analysts that the acquisition has now closed, somewhat ahead of schedule. Once more, Charles Phillips, CEO of Infor outlined a rather aggressive schedule of planned technology enhancements related to GT Nexus. This is typical of Infor’s model related to acquisitions.
Three separate development teams have now been dedicated to GT Nexus integration and enhancements, including the additional of 40 new developers.
GT Nexus technology supports the ability of buyers to transmit order information across a connected supply chain business network, linking various suppliers, logistics providers and financial institutions. In the latest briefing, Infor executives reiterated the attractive opportunities among traditional ERP customers to implement broader supply chain business network support. Further communicated was that Infor and GT Nexus customer feedback has been universally positive.
There was a candid admission that GT Nexus software was not the most user-friendly, and to little surprise, there are now plans to convert GT Nexus screens to the newly designed Infor user experience. Further outlined were plans to deploy a robust security model along with a plan to deploy Infor S&OP on the GT Nexus network. Another cross benefit opportunity was noted as the opportunity to augment Infor’s existing warehouse management and transportation management functionality with technology within GT Nexus.
While GT Nexus is now a stand-alone operating unit of Infor, executives did indicate a co-mingling of sales teams over the next 6-9 months. Infor’s fiscal year ends in April which is more than likely the target for a singular sales team.
There is little doubt that Infor views GT Nexus as a significant market opportunity for adding multi-industry support in deploying more robust supply chain business networks for both large and mid-market firms. While Infor’s marketing message declaring the “first global commerce cloud” is somewhat over the top, it should not negate the need for this level of supply chain technology support. Adding more robust planning and analytical decision-making components to the GT Nexus platform provides even more industry attraction. The open question however, is Infor’s pricing strategy and approach.
Customers with technology from either or both of these technology providers should expect accelerated integration and aggressive up-sell strategies in the coming months.
Supply Chain Matters has long advocated that today’s more globally based supply chains require end-to-end business network technology support in supply chain execution, customer fulfillment and more integrated business planning dimensions. From our lens, Infor’s plans related to GT Nexus will motivate other initiatives and/or acquisitions in this area.