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Panasonic buys Blue Yonder to boost supply chain
- May 3, 2021
- Steve Rogerson
Japanese technology giant Panasonic has acquired Arizona-based Blue Yonder to accelerate the autonomous supply chain by combining IoT, edge, AI and ML technology.
Blue Yonder is an end-to-end, digital fulfilment platform provider. Panasonic will purchase the remaining 80% of shares for $5.6bn, adding to the 20% it acquired last year. Including repayment of outstanding debt the additional investment totals $7.1bn, valuing Blue Yonder at $8.5bn.
The need for more intelligent, autonomous and edge-aware supply chains has been heightened by the Covid-19 pandemic, the rise of ecommerce and the proliferation of data. This acquisition should strengthen Panasonic’s portfolio and accelerate the companies’ shared autonomous supply chain mission, empowering uers to optimise their supply chains using the combined power of AI, ML, IoT and edge devices.
By unifying supply, demand and commerce with IoT and edge technologies, companies can better use predictive business insights to pivot their operations in real time. Combining Panasonic’s strength in industrial engineering, IoT and edge technologies with Blue Yonder’s AI and ML-driven supply chain and commerce technology intensifies the value of Blue Yonder’s digital fulfilment platform.
Together, Panasonic and Blue Yonder aim to help users drive more automation and actionable, real-time business insights that reduce waste and improve operations.
This acquisition builds on the Panasonic and Blue Yonder strategic relationship, established in January 2019 with a partnership, followed by the creation of a joint venture company in Japan in November 2019. In July 2020, Panasonic took a 20% minority ownership stake and one seat on the board of directors of Blue Yonder.
Blue Yonder provides an end-to-end platform driven by AI and ML that serves as a system of intelligence for its global retail, manufacturing and logistics customers. Its cloud-based Luminate platform seamlessly manages all nodes of the supply chain across planning, execution and commerce.
Last year, Blue Yonder revenue was over $1bn, 67% of which was recurring revenue. SaaS annual recurring revenue was $343m and SaaS net revenue retention rate was 120%. The company counts more than 3000 global customers including 65 of the top 100 retailers, 48 of the top manufacturers, and nine of the top ten global third-party logistics companies.
Blue Yonder’s customers include Albertsons, Best Buy, BP, Caterpillar, Coca-Cola, DHL, Diageo, Lowes, Marks & Spencer, Mercedes Benz, PepsiCo, Procter ＆ Gamble, Starbucks, Unilever and Walmart. The company owns more than 400 patents granted and pending.
Blue Yonder CEO Girish Rishi and the extended leadership team will join the new organisation and the Blue Yonder brand will be retained and business will function within the Panasonic Connected umbrella.
“This association came about as a result of three years of working together, first with Panasonic as a Blue Yonder customer and thereafter as joint venture partner,” said Rishi. “We have developed mutual trust and have a shared vision for an autonomous supply chain that delivers a better life and a better world. As the essential platform for essential times, we are relentlessly focused in fulfilling our customers’ potential.”
With Blue Yonder, Panasonic believes it will be better equipped to empower customers to optimise their supply chains using the combined power of AI, ML, IoT and edge devices.
“Both companies have the same mission to support customers’ frontline operations and we have a high affinity in our corporate cultures,” said Panasonic CEO Yuki Kusumi. “By merging the two companies, we would like to realise a world where waste is autonomously eliminated from all supply chain operations and the cycle of sustainable improvement continues. There are still many such losses and stagnation in supply chain operations, so through the drastic reduction of wasted labour and resources, we would like to provide better ways of working, and contribute to customers’ management reform and also to the realisation of a sustainable society by carefully using limited global resources. I am confident that by combining the power of Blue Yonder and Panasonic, we can create innovation in global supply chains.”
The transaction has been approved by the boards of directors of both Panasonic and Blue Yonder. The deal is intended to close by the second half of this fiscal year and is subject to receipt of customary regulatory approvals.