Panasonic had agreed to acquire Blue Yonder, a US artificial intelligence (AI) software developer, for US$7.1 billion. This is also one of Panasonic’s largest acquisitions. Prior to this, Panasonic already held a 20% stake in Blue Yonder.
According to a statement released, Panasonic will acquire the remaining shares of Blue Yonder from funds managed by New Mountain Capital and Blackstone Group for a price of US$5.6 billion.
This is consistent with a previous report, which stated at the time that Panasonic’s total investment will reach 7.1 billion U.S. dollars, including repayment of outstanding debts.
Less than a year ago, Panasonic acquired a minority stake in Blue Yonder for US$800 million, valuing Blue Yonder at approximately US$5.5 billion. And Panasonic’s latest purchase price is valued at approximately US$8.5 billion for Blue Yonder.
Panasonic will use cash in its hands and a “bridge loan” to fund the transaction. It is expected that the transaction will be completed before the end of this year.
After the news came out, Panasonic’s stock price plummeted today on the Tokyo Stock Exchange and hit its lowest point since January 18. At the close, Panasonic shares fell 3.5%.
Blue Yonder was founded in 1985, formerly known as JDA Software Inc. It mainly develops supply chain management software and uses artificial intelligence technology to predict product demand.
According to this statement, Blue Yonder’s revenue last year exceeded $1 billion. Blue Yonder has more than 3,000 customers worldwide, including Best Buy Co., Coca-Cola, and Wal-Mart.
Interestingly, Panasonic’s acquisition will make Blue Yonder abandon its listing plan. Earlier this month, Blue Yonder had just submitted a secret IPO (initial public offering) application to the US Securities and Exchange Commission (SEC).
While Panasonic acquired Blue Yonder, another well-known Japanese company, Toshiba, was facing the situation of being acquired.
On April 6, European private equity firm CVC issued a preliminary proposal to Toshiba, planning to combine several Japanese companies and a government-backed investment fund to acquire Toshiba for US$20 billion. On April 13, people familiar with the matter said that KKR, the world’s top investment institution, planned to spend more than US$20 billion to bid for Toshiba with CVC.
On April 20, CVC temporarily shelved the acquisition, saying that it would wait for further “instructions” from Toshiba. The reason is that Toshiba announced on April 13 that the company’s CEO Nobuaki Kurumatani had resigned and the CEO position was succeeded by Chairman Satoshi Tsunakawa. The management turmoil complicates the acquisition.
Besides, a US private equity firm is considering a bidding plan for the acquisition of Toshiba. As for whether it will cooperate with other investors, it is not yet known.