Panasonic’s acquisition of Blue Yonder takes shape

Following a series of mixed reports earlier this year, regarding the acquisition of Scottsdale, Ariz.-Based Blue Yonder (formerly JDA), a provider of end-to-end supply chain management services based on the AI by global electronics giant Panasonic, Panasonic announced late last week that the transaction is now officially complete.

The company said it bought the remaining 80% of Blue Yonder shares, which it said it would do in April, as well as the 20% of Blue Yonder shares it acquired in July 2020, when it acquired a minority stake and a seat on the board of directors of Blue Yonder, with New Mountain Capital and funds managed by Blackstone remaining majority shareholders of Blue Yonder, fully committed to supporting the strategic vision of the company.

Panasonic added that the investment values ​​Blue Yonder at $ 8.5 billion and that the deal has completed antitrust proceedings and has also received approval from regulatory authorities in the United States and other countries.

“The acquisition accelerates Panasonic and Blue Yonder’s shared vision for a self-sustaining supply chain,” Panasonic officials said in a statement. “By unifying Panasonic’s sensing technologies and edge devices with Blue Yonder’s AI / ML-based planning, execution and commerce solutions, businesses can create e-commerce strategies, retail, smarter and more connected warehouses, transportation and workplaces. This unique end-to-end offering gives customers unlimited visibility, control and orchestration, enabling them to pivot operations in real time, deliver a superior customer experience and drive more profitable business results.

Panasonic has also stated that the Blue Yonder brand will be retained, with the company operating within the Panasonic Connected Solutions Company. And Girish Risi, CEO of Blue Yonder and the management team of Blue Yonder will remain with the company.

A spokesperson for Blue Yonder previously said LM, at the time, that this expanded partnership would accelerate Blue Yonder’s AI / ML (machine learning) platform to make faster, more contextual business decisions for global supply chains and accelerate the chain’s promise. autonomous supply. And he added that Blue Yonder and Panasonic will combine their resources and work closely with partner companies in Japan to fuel growth by selling Blue Yonder’s Luminate solutions and offering new jointly developed solutions.

Panasonic described various benefits the deal will provide, including:

  • strengthen Panasonic’s portfolio and accelerate enterprises’ shared autonomous supply chain mission, enabling customers to optimize their supply chains using the combined power of AI / ML and IoT and devices peripheral devices ;
  • unify supply, demand and commerce solutions with IoT and advanced technologies, enabling businesses to better use predictive business insights to pivot their operations in real time;
  • Combining Panasonic’s strength in industrial engineering, IoT and cutting-edge technologies with Blue Yonder’s AI / ML-based supply chain and commerce solutions increases customer value of the leading platform digital processing form of Blue Yonder; and
  • Together, Panasonic and Blue Yonder will provide a unique competitive advantage for customers to generate more automation and real-time actionable business information that reduces waste and improves operations, while creating a more sustainable world.

For calendar year 2020, Blue Yonder’s total revenue exceeded $ 1 billion, of which 67% was recurring revenue, and as of December 31, 2020, annual SaaS recurring revenue was $ 343 million and the retention rate of SaaS net revenue was 120%.

Panasonic said that integrating Blue Yonder into the fold strengthens its digital transformation and customer focus, adding that as of April 1, 2022, “the Panasonic Group will transition to a holding company system focusing management resources on strategic activities in key areas such as the provision of supplies. chain innovation and automation.

In early March, when the possibility of acquiring Blue Yonder by Panasonic was first raised, Ben Gordon, Managing Partner of Cambridge Capital, an investor in niche supply chain leaders, and also Managing Partner of BGSA Holdings, a leading mergers and acquisitions advisory firm focused on the transportation, logistics and supply chain technology industries, said Panasonic’s acquisition of Blue Yonder reflects the growing importance of software supply chain.

“This is the largest acquisition Panasonic has made in a decade,” he said. “The purchase gives them the ability to combine hardware and software. This is a strategic move that could give Panasonic a head start over other hardware vendors. Will Blue Yonder step down and stop selling software to other hardware and electronics vendors? It could be 2021 is the year of the supply chain. In other words, it could be a signal of the growing global recognition of the importance of the supply chain. “

When reports surfaced that Blue Yonder was considering a possible IPO in April, he said the number of shares to be offered and the price range of the proposed offering should be determined, adding that the public offering Initial was to take place after the SEC completes its review process, subject to market and other conditions.

A Wall Street Journal report observed that, according to research firm Gartner, Blue Yonder is the third largest supply chain management software provided on the basis of 2019 revenue, behind SAP and Oracle.

Additionally, the report indicated that other players in nascent logistics technology are getting involved on the IPO front, with Chicago-based Project44, a technology services provider offering service API integrations. Standardized and secure web (application programming interfaces) allowing 3PLs and shippers to connect with carriers. in real-time, which would consider an IPO in the next 18-24 months, and E2open, a cloud-based service provider for collaborative planning and execution on global trade networks, going public in early 2021 with a special purpose acquisition company (SPAC).

In February 2020, Blue Yonder changed its name from JDA. The company said the name change was part of a re-branding initiative to better align its name with its cloud transformation and product roadmap and also to embrace endless innovation at the future, as well as continuous improvement and an emphasis on exceptional customer experience as well.

The company explained that the change of its name and brand from JDA to Blue Yonder “further supports the massive impact of AI and ML technology on the supply chain, logistics and retail markets.” , adding that “Blue Yonder’s leading AI / ML technology powers the Luminate end-to-end digital execution platform.

About the Author

Jeff Berman, Group News Editor Jeff Berman is Group News Editor for Logistics management, Modern material handling, and Supply chain management review. Jeff works and lives in Cape Elizabeth, Maine where he covers all aspects of the supply chain, logistics, freight transportation and material handling industries on a daily basis. Contact Jeff Berman

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