GE Transportation Acquires ShipXpress


GE Transportation Acquires ShipXpress

Transaction Size – Undisclosed


GE Aims to Strengthen Cloud Software Expertise  

  • ShipXpress is a provider of cloud-based rail-road management software for the transportation, industrial, and commodities sectors; the acquisition seeks to bolster GE’s rail-industry supply chain offerings
    • The deal will complement GE’s sensor technology and likely integrate with its existing RailConnectTMS and OASIS (multi-modal TMS) for a future deployment onto Predix
    • Predix provides a cloud-based management and analytics platform to traditional heavy-duty machine industries and was made public in 2015; GE has coined its ecosystem the ‘industrial cloud’ or ‘industrial internet’
    • GE plans to shed over $200bn (2015-2016) in traditional-business to transform into a digital industrial company, hiring over 1,000 software engineers in 2013 alone
  • In 2014 ShipXpress acquired FreightCar America’s Rail Fleet Management Software Services business. The business provided maintenance management and repair billing capabilities to integrate with the existing ShipXpress platform.
    • The technology likely aided ShipXpress in its later partnership deal with SparkCognition to provide predictive analytics railcar maintenance and management


M&A and Investments in the SCM and Transportation Management System (TMS) Industries

  • Driven by a shift to e-commerce and Internet of Things (IoT), the SCM and TMS industries have seen a considerable increase in recent investments and M&A activity
    • Investments are geared towards providing added software capabilities and integration with traditional ERPs to allow for a more holistic management approach
  • The recent announcement of Honeywell’s acquisition of JDA Software (TBP Spotlight 08/15/2016) was challenged by a $570mm equity investment agreement reached with Blackstone Group, indicating an increase in interest in the SCM and TMS space from both private equity and strategic buyer segments
  • The need for organizations to integrate and synchronize TMS processes horizontally across business divisions (purchasing, manufacturing, sales) is one of the most important current trends. (Gartner)
    • As this initiative matures, organizations will begin to focus onto implementing multi-modal capabilities that allow for management across multiple methods of transportation, as opposed to managing each transportation pipeline separately
      • The global TMS market is estimated to reach $1.72bn by 2019


Recent TMS-Related Transactions

Date Buyer Target EV ($mm) Business Description
08/19/2016 Blackstone Group JDA Software $570.00 Honeywell acquisition offer for $3bn was challenged by equity investment by Blackstone
07/01/2016 ShippingEasy $55.00 ShippingEasy provides cloud-based shipping solutions for online merchants that recommends and assigns the cheapest USPS shipping rates
05/02/2016 Kewill LeanLogistics $115.00 Kewill acquired LeanLogistics to enhance its full-service SCM suite
02/04/2015 Insight Venture Partners E2Open $249.90 E2open provides cloud-based, on-demand software solutions for SCM
08/27/2014 RoadRunner Transportation Systems Active Aero Group $115.00 Active Aero provides supply-chain solutions focused on transportation logistics in N America
03/11/2014 ShipXpress FreightCar America N/A ShipXpress acquired FreightCar America’s Rail Fleet Management Software Services business

TBP was NOT an advisor to this transaction