Infor taking over GT Nexus!

Infor-GT-NexusThe ERP and supply chain software specialists Infor, have just announced a few days ago that they are about to take over GT Nexus, one of the leading logistics, sourcing and visibility providers. The price is a stunning $675 million. Warburg Pincus (a private equity provider) own approximately 40% of GT Nexus; its founders and managers owning the balance. It looks like they can look forward to a handsome payday in the very near future.

Infor – paving the way for significant expansion

According to their CEO, Mr. Charles Philips, Infor has clocked-up in excess of $2.8 billion worth of sales over the past year but this latest acquisition confirms that the supply chain software management giant is paving the way for further expansion, and on a large scale too.

GT Nexus are no slow coaches themselves. It is reputed that they handle over $100 billion worth of goods movements on behalf of some 25,000 clients.   Some of the more well-known names that this cloud-based organization works for include the likes of Adidas, Caterpillar, DHL, UPS, Levis Strauss and Proctor and Gamble.

The background of GT Nexus 

GT Nexus first began trading in the late 1990s under the name of Tradiant. In its formative years it was engaged primarily in trying to automate the many aspects of the ocean shipping booking sector of the logistics industry. The name change to GT Nexus came about 11 years later in 2001 as the company continued to grow in size and stature, both internally and through the advent of various external acquisitions. One major acquisition was that of TradeCard, the global sourcing provider back in the year 2013.

In addition to their reputation in the field of its global sourcing capabilities, GT Nexus is also reputed for its global transportation management function, and the visibility that it provides for both shippers and 3PLs with their famous “control tower” overview function that helps to keep tabs on the movements of shipments on a worldwide scale.

GT Nexus also operates competitively in the GTN market (Global Trade Management) where they go up against other organizations such as Amber Road in addition to other competitors in the other particular areas that their complete suite of software solutions reach into. They are also very well known for their use of cloud-based technology which they’ve embraced since it first became technically and economically viable.

GT Nexus has been quietly waiting for a potential buyer to come along since late last year. The companies who have expressed an interest in the past include organizations as far apart as SAP and Facebook, both of which are reported to have given considerable thought to the takeover before deciding not to make a move.

Infor’s acquisition pedigree

Their loss is Infor’s gain, and it will give the reinforced Infor further capabilities that will deepen their penetration of the supply chain software management industry sector, as well as giving them a link into the actual physical side of logistics management.

Infor has actually grown as an organization thanks to the astute acquisitions it has made. These acquisitions have given them insight into the roots of various aspects of supply chain management software and ERP, when their growth embraced the likes of Lawson, MAPICS and SSA.

Other sorties into the supply chain industry in the past have included acquisitions of supply chain execution providers the likes of EXE Technologies and Provia.

Infor being steered in new directions by CEO Mark Philips

As Infor gained insights through its various acquisitions, the company mainly focused its attention on simply maintaining its growing base of customers across the various supply chain industry sectors. But when Mark Phillips first took over as CEO in 2010, that all began to change. With the experience and expertise he had gained at Oracle and at Morgan Stanley as one of the world’s top best-known enterprise software market analysts, he brought his knowledge to bear in steering Infor into taking new directions and seeking a more active role in developing the marketplace.

The GT Nexus acquisition could be complete in 45 days

This latest deal involving the acquisition of GT Nexus is a clear indication of the revised thinking that Philips has brought to the organization’s supply chain strategy. The acquisition itself is yet to be finally approved by the regulatory authorities; however, that is not expected to create any problems and it is believed that the deal will probably be brought to a close in as little as 45 days time.

The need to exploit cloud-based technology to improve supply chain management software

According to James Cook of Nucleus Research, he maintains that in order for them to maintain their primary leadership position in the field of ERP software, Infor need to have a global cloud operating platform within their structure; a platform that will enable them to manage their supply chain partners who are engaged in bought-in manufacturing. The cloud experience and technology that GT Nexus have already absorbed meets that particular objective very nicely.

It seems that an opportunity exists for someone to lead the way in supply chain software, and this latest move by Infor looks as if that’s exactly what it is designed to achieve. It’s all down to the “control tower” management solution that GT Nexus have created; a solution that could well prove to be the singularly most important development in global supply chain logistics solutions in the next few years.

The most progressive and aggressive step Infor have taken to date

There is no doubt that this step that Infor has taken to draw GT Nexus into its embrace is the most aggressive and forward step it has taken to date. Whereas in the past many of the acquisitions were designed to take advantage of businesses that had run into tough times in terms of both ERP and supply chain software, this latest acquisition takes on a vibrant new force.

What with GT Nexus enjoying such a strong position in the supply chain logistics sector and with so many organizations desperately looking for better supply chain position visibility, Infor is going to have its work cut out for it in terms of making sure the full potential is realized.

But when all is said and done, the GT Nexus acquisition, if exploited correctly, looks set to deliver Infor’s ERP and supply chain software ambitions.

Do you think that the GT Nexus acquisition is the right thing for Infor to have done, or do you believe it could take them in the wrong direction and split their attentions across too many boundaries? How important do you believe cloud technology to be in terms of providing better and more intuitive supply chain solutions, and do you believe the GT Nexus acquisition will provide Infor with the right platform for best use of cloud technology?

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