Infor acquires GT Nexus in $675m deal

Privately-held ERP software company plans on using the multi-tenant, cloud-based systems of GT Nexus to help customers orchestrate their global supply chains.

Infor acquires GT Nexus in $675m deal

Privately-held ERP software company plans on using the multi-tenant, cloud-based systems of GT Nexus to help customers orchestrate their global supply chains.

Infor acquires GT Nexus in $675m deal

Privately-held ERP software company plans on using the multi-tenant, cloud-based systems of GT Nexus to help customers orchestrate their global supply chains.

 
The enterprise resources planning software provider Infor has acquired the global commerce platform GT Nexus for $675 million, the company said Tuesday.
    The deal will see Infor leverage GT Nexus’ strength in cloud-based global transportation execution, visibility, order management, and supplier financing. Among GT Nexus’s customers are adidas Group, Caterpillar, Columbia Sportswear, DHL, Home Depot, Levi Strauss & Co., Maersk, Nike, Pfizer, Procter & Gamble, and UPS.
    Privately-held Infor is trying to gain market share from the established global ERP software leaders Oracle and SAP by focusing on cloud-based solutions and ease of deployment. It’s led by Charles Phillips, a former Oracle executive.
    “This is postmodern ERP software -- instead of being for one company it’s for multiple companies,” Phillips said in an interview with Bloomberg. “We go in where there’s fatigue and shelfware. It’s a big market.”
    GT Nexus prides itself on its multi-tenant cloud-based network of shippers, logistics companies, transportation providers, and suppliers. The network aspect means that improvements to its solutions are available to all users.
   It also means that partners added to the network by one user are added to the network for all users, creating a multiplier effect that helps companies make their logistics processes more efficient more quickly by being able to essentially immediately onboard their supply chain partners more quickly.
    Infor said its architecture is similar to that of GT Nexus.
    “Both have a single canonical map for orders, are event driven, and make use of open source components,” the company said in a statement. “Unlike other B2B information exchanges, GT Nexus is a network cloud service with one code base for all customers providing a single view of the order across the value chain. The canonical map allows suppliers to join the network once and talk to all buyers, as opposed to implementing custom maps and portals for each buyer, which is required in legacy networks.”
    GT Nexus significantly expanded its capabilities in the order-to-cash realm in early 2013 by merging with TradeCard, a deal that means it facilitates more than $20 billion in transactions annually between buyers and suppliers.
    GT Nexus’ platform is seen in the market as a top end global transportation management and visibility platform, providing execution capabilities that evade many TMS providers that are more domestically focused. It is typically suited to larger organizations with large global footprints, complex supply chains, and hundreds of transportation lanes.
   “Together, Infor and GT Nexus will provide customers with unprecedented visibility into their supply chains to manage production and monitor goods in transit and at rest," Phillips said in a statement. "In a complex, high velocity supply chain, all partners need to know what was ordered, when it was built, where it is in transit, if the order has changed, and has it cleared customs. Specialization and speed are moving the future of manufacturing into the commerce cloud."
    James Cooke, principal analyst at the analyst and consultant Nucleus Research, said the motivation for Infor is clear. It wants to compete with SAP and Oracle by creating a more effective platform for global supply chain orchestration.
    “The ERPs of old were financial systems of record,” he said. “But now orders come in from the web and the most important thing is to be able to orchestrate that order with all the supply chain partners around the world.”
    He said GT Nexus’ multi-tenant cloud-based structure is suited to that ordering environment.
    “Infor is an ERP solution within the walls,” Cooke said. “The motivation for buying these guys is they’re realizing that ERP as systems of record worked 10 years ago when one company was the dominant one in the supply chain. But now it’s about coordination between all the trading partners in the supply chain. Infor obviously recognizes this.”
   For GT Nexus, the deal gives them access to more programmers and development dollars to take the next step in both companies’ evolution, what Cooke described as supply chain control towers (and not logistics control towers).
    "As you move toward outsourced manufacturing, you need a global cloud network to orchestrate production,” he said. “But you have to incorporate demand so the supply chain can respond and react to reconstitute itself. Control tower is matching supply with changing demand.”
    GT Nexus provides the visibility and execution pieces – the logistics side of the control tower – but lacked the demand sensing and production scheduling pieces.
    “Infor has a real opportunity to become a leader in supply chain software if it puts development dollars in and turns it into full-fledged control tower,” he said.
    Cooke cautioned that Infor has let other supply chain acquisitions, in supply chain design and optimization, languish.
   Early indications are that GT Nexus will remain a separate business unit within Infor. The company was founded in 1998 with private equity firm Warburg Pincus, which owns 40 percent of the company and a key investor through the years.
Normally, the fourth quarter is a peak season for air cargo. So, essentially flat growth in November is a big disappointment. While our outlook is for 3.7 percent demand growth in 2019, downside risks are mounting. Trade tensions are cause for great concern. We need governments to focus on enabling growth through trade, not barricading their borders through punitive tariffs.
THE Alliance — ACL/StreamLines - Transatlantic Loop 2-AL2 has increased the total transit time from 28 days to 35 days.  The AL2 removed the vessel Shanghai Trader  and added Brevik Bridge and Berlin Bridge , increasing capacity by 3,998 TEUs or 20 percent while remaining a weekly service.
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