Details of the deal between Blue Yonder and Panasonic
The Japanese Panasonic Corporation announced the acquisition of the American software developer, Blue Yonder. The transaction amounted to 7,1 billion dollars, which is the biggest purchase of the Japanese producer for the last 10 years.
Last year Panasonic bought the company’s stock at the rate of 20% for 797 million dollars. Now the Japanese corporation decided to buy the rest of the shares from different holders, including Blackstone and New Mountain Capital. Panasonic explained its intentions by the need to optimize its processes. The point is that during the pandemic the quantity of deliveries sharply increased and it became urgent to improve autonomous and intellectual chains of logistics.
Panasonic will use cash to pay for the deal, which will be half of the total cost. The rest will be repaid with a bridge loan, and it will be refinanced through subordinated bonds, and there is also the option of other hybrid financing.
Panasonic Corporation has long been focused on home appliances and electronics. Recently, however, it has focused on developing and manufacturing parts and providing services to other companies. Among the manufacturers’ customers are batteries for Tesla electric cars.
Last year, Panasonic expanded areas for cooperation with Blue Yonder, and joined the board of directors. Since then, the Japanese corporation has been directly involved in the company’s strategic issues.
Blue Yonder develops software and management systems based on machine learning. The company provides digital platforms for organizing supply chains, setting up enterprises and their warehouses. Blue Yonder’s customers include such giants as Unilever, Walmart and Starbucks.
The developer was founded in 1985 in Arizona. Until 2020 it was called JDA Software, but the company was rebranded and renamed Blue Yonder. That was the name of the firm that was developing products for the retailer based on artificial intelligence technology. JDA Software bought it out and took the name back. The decision to rebrand was dictated by the company’s management plans for further development in the segment of digital transformation products. In the same year, Blue Yonder became the third largest software company. It was second only to SAP SE and Oracle in terms of revenue for 2020.
In addition to expanding its business lines, Panasonic plans to gain a foothold in the U.S. market with help. In terms of demand for digital solutions, the U.S. is a promising segment, and by securing the developments of Blue Yonder, the Japanese manufacturer will be able to reach a new level.