WiseTech to acquire e2open in USD $2.1bn cash deal

WiseTech Global has agreed to buy US supply chain software group e2open in an all-cash deal valued at USD $2.1 billion on an enterprise value basis.

The Australian logistics software supplier will pay USD $3.30 per share for e2open. The transaction will be funded entirely with debt through a new syndicated facility.

WiseTech develops the CargoWise logistics execution platform. E2open sells software for supply chain and global trade management and runs a multi-enterprise network connecting manufacturers, logistics providers and other partners.

The acquisition adds a second large platform in adjacent areas of trade and logistics software, expanding the group's reach across domestic logistics, carrier integration, global trade and supply chain management.

Deal terms

The acquisition price and associated costs will be funded through a fully underwritten debt facility totalling USD $3.0 billion. The facility is structured across multiple tranches with maturities of up to five years.

WiseTech expects a pro forma net leverage ratio of about 3.5x FY25 EBITDA when the transaction closes, excluding synergies. It is targeting net leverage below 2.0x within three years of completion.

Post-transaction liquidity is forecast at about USD $0.7 billion from cash on hand and an undrawn revolving credit facility.

Bank of America, Barrenjoey/Barclays and Macquarie are acting as financial advisers to WiseTech, with Gresham as debt adviser.

Platform reach

E2open was founded in 2000 and is headquartered in Addison, Texas. It operates in more than 20 countries.

The e2open platform connects more than 500,000 manufacturing, logistics, channel and distribution partners and tracks more than 18 billion transactions annually.

WiseTech said e2open has about 5,600 customers, including more than 250 blue-chip customers, and connectivity with major ocean carriers.

WiseTech said there is little overlap between the two companies' customers and products, positioning the deal as an expansion into adjacent markets and customer bases.

Integration approach

WiseTech said e2open's structure across product groups and previously acquired businesses supports a phased integration. It plans to treat the business as a sequence of smaller integrations, prioritised by value and timing.

Until completion, e2open and WiseTech will operate as independent companies.

The transaction is subject to customary conditions precedent and regulatory approvals, with completion expected in 1H26.

E2open shareholders holding a majority of the voting power have already approved the transaction by written consent, and no further shareholder vote is required.

Financial impact

WiseTech expects the acquisition to be earnings per share accretive in the first year, before synergies. FY25 guidance remains unchanged, apart from about USD $40 million of one-time transaction costs to be recorded in FY25.

Richard White, Founder, Executive Chair and Chief Innovation Officer at WiseTech Global, described the acquisition as a step in the company's strategy in trade and logistics software.

"Acquiring e2open is a strategically significant step in achieving our expanded vision to be the operating system for global trade and logistics," White said.

White said e2open brings complementary products to the WiseTech portfolio.

"E2open brings to WiseTech several well established complementary products. This will enable WiseTech 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," White said.

"E2open also expands WiseTech's product capabilities with an experienced team of people with industry expertise and innovative product development skills that will further accelerate our organic growth capability," he said.

"In bringing the 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. This is a great deal for WiseTech's business and e2open's shareholders, for all our customers, the industry and ultimately the end consumer," White said.

Andrew Appel, Chief Executive Officer of e2open, said both companies focus on improving supply chain operations using software and data.

"E2open and WiseTech have complementary products across transport, logistics, supply and demand ecosystems, and both organizations are committed to improving the efficiency, productivity and security of global supply chains through better use of technology, data, automation and artificial intelligence. This strategic combination empowers our people, and our customers who make, move, and sell goods and services to unlock new levels of efficiency and sustainability. As the connected supply chain platform, we are excited to join forces with WiseTech to create a truly global, intelligent logistics ecosystem as we jointly lead the digital transformation of our industry," Appel said.