Popular tech stock WiseTech Global Ltd (ASX: WTC) has made its first acquisition for the year. Here’s what you need to know.
About WiseTech Global Ltd
WiseTech Global was founded in 1994 by Richard White to provide software to the logistics sector. Since then, it has grown to become a global provider of logistics software, claiming to service 19 of the top 20 logistics companies globally.
WiseTech makes money by charging its customers on a ‘per use’ basis rather than as a subscription model. Meaning, WiseTech directly benefits as its customers grow their businesses.
What’s Happened?
This morning, WiseTech announced the acquisition of SISA Studio Informatica SA, a customs and freight forwarding solutions provider in Switzerland.
The net purchase price consists of $15.5 million upfront, with a further earn-out potential of up to $8.9 million related to business and product integration, customs development and customer conversion.
While of strategic value, WiseTech does not consider the acquisition to be material with SISA providing 2018 annual revenue of $12.4 million and EBITDA of around $500,000.
The video below explains what EBITDA is and how to calculate it:
Commenting on the acquisition, WiseTech Founder and CEO Richard White said, “For over 40 years, SISA has accumulated a powerful breadth and depth of expertise across the customs and logistics landscape in Switzerland that will enhance our global customs and localisation capability, and further strengthen our solutions for logistics providers throughout Europe.”
What Happens Next?
SISA will remain under the leadership of managing director Roland Schumacher and is expected to be consolidated into WiseTech’s accounts from February 2020.
SISA’s operations will be integrated within the WiseTech group and the Swiss-based company will continue to deliver their customs and logistics solutions directly to their existing customers, along with WiseTech’s CargoWise One over time.
WiseTech shares were last trading more than 4% lower today at $22.87 per share. The company’s share price has been under pressure since a short-seller attack towards the end of last year.
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