This is an overview of Mergermarket proprietary intelligence in tech for the supply chain in Europe over the last four months, featuring existing opportunities in the market. Snapshot is the new name for a Preview. 

Lockdowns to tackle the first phase of the COVID-19 pandemic hit global supply chains hard. As a result, tech providers who are digitalising the segment suddenly found themselves at the centre of attention.

“It has become difficult for a logistics company to attract clients if they are not able to deliver performance indicators, data and tracking,“ Brieuc André, COO and co-founder at Ovrsea told Mergermarket. The live tracking of shipped products has become a particularly sought-after offer, he added.

The increased attention on digital solutions for supply chains has led to a spike in deal activity in Europe. End users, who are digitalising their own companies, expect their supply chain providers to keep up with that trend, Jack Azoulay, senior partner at pan-European private equity (PE) firm Argos Wityu said.

Deals carried out by tech experts in the supply chain sector surged in 2020 during the first phase of the pandemic and peaked in 2021 and 2022, according to Mergermarket data.

Aggregate deal volumes were EUR 38bn across 333 deals in 2022, the highest level in the 2018-2023 period. Volumes dipped last year, but 2024 is already off to a flying start.

Tracking leads the race

Faced with growing demand, tech solution providers for the supply chain have been acquiring peers to expand their global footprint.

Michael Falck, co-founder of RELEX Solutions told Mergermarket in January that the company is actively scanning the market for acquisition targets to complement its technology and bring synergies. The Finnish company, which has a score of 54 out of 100 according to Mergermarket‘s Likely to Exit (LTE) predictive algorithm, had previously acquired Swedish peer Optimity.*

E-commerce experts have also been looking into expanding to supply chain-dedicated solutions. This January, CEO Giovanni Conforti told Mergermarket that Italy-based Yakkyo [BIT:YKY] would look into targets with a special focus on verticals along the supply chain, as well as e-commerce-related groups with expertise in warehouse management, logistics – especially in ‘last mile’ deliveries and operations automation.

The M&A data also reflect interest in the sector from investors. TrusTrace, a Swedish software-as-a-service (SaaS) platform dedicated to product traceability and compliance, secured a USD 24m funding round led by Circularity Capital, as reported. Trustrace has a LTE score of 12 out of 100.

However, the logistics market is foreign to the usual investors in software solutions, which makes financing harder to secure, André said.

Top-to-bottom digitalisation 

Despite the sector’s growing need for digitalisation, there is a long way to go, especially because it is a fragmented market with many players who are too small to afford to digitalise their products, André said.

Several investors have already identified the need for small and medium-sized enterprises (SMEs) to gain access to tech tools. Last month, Firmament, an expert in structured equity capital solutions for small and medium-sized companies, acquired a majority staked in Belgium-based provider of logistics software solutions for transport service providers Navitrans, as reported.

Meanwhile, in February, US-based supply chain solutions provider Blue Yonder, which is owned by Japanese Panasonic Holdings Corporation, bought German flexis AG, a software technology provider specialised in production optimisation and transportation planning and execution, as reported.

*Mergermarket’s LTE predictive analytics assign a score to sponsor-backed companies to help track and predict when an exit could occur through M&A, an IPO, a direct listing or a deSPAC transaction. 

Proprietary intelligence

Twinzo, 31/01/2024

Twinzo, a Slovak digital twin solution company dedicated to the manufacturing and logistics sectors, plans a EUR 5m to EUR 10m Series A fundraising round this year to support scaling up, CEO and co-founder Michal Ukropec said. It plans to open the round in May or June and close by year-end. Twinzo targets VC funds that focus on deep tech, Industry 4.0 and digital twins as ideal investors and prefers funds based abroad.

Yakkyo, 29/01

Italian software provider with a supply chain management platform Yakkyo [BIT:YKY] has started scouting for potential acquisitions in Italy and abroad, CEO Giovanni Conforti said. It is currently evaluating a dossier regarding a UK-based target. Yakkyo would look at more targets with a special focus on verticals along the supply chain, and experts in warehouse management, logistics as well as ‘last mile’ deliveries and operations automation. Yakkyo generated EUR 6.5m in revenue in 2022, and could evaluate targets of a similar size to itself.

RELEX Solutions, 18/01

Finland-headquartered, unified supply-chain and retail planning platform company RELEX Solutions is actively scanning the market for acquisition targets to complement its technology and bring synergies, co-founder Michael Falck said. RELEX, which turned over EUR 174m in FY22, is interested in technology which offers product management or pricing optimisation. RELEX is not looking to acquire revenue or new customers, and it is focused on enhancing its product offer, he said.

Shippingbo, 18/01

French Shippingbo, which publishes logistics-automation software for e-retailers, will consider M&A to gain a foothold in new European markets from 2024, Chief Strategy Officer Romain Parent said. It plans to enter Spain this year and is scouting the market for local peers that could bring clients and a team there. Shippingbo could raise a Series B round exclusively to finance acquisitions. This year is the right time to raise a EUR 30m to EUR 50m Series B, or debt, he added.

Aeler Technologies, 08/01

AELER Technologies, a Swiss smart container shipping company, is welcoming more partnerships to expand further in Asia, co-founders and co-CEOs Naik Londono and David Baur said. The startup has partnered with Singapore-headquartered freight services provider JNC Line and Kaichem, a Taiwanese freight forwarder, for its expansion into Asia. AELER targets to have a firm presence in Asia Pacific and other regions, specifically Indonesia, Vietnam, Malaysia, Japan, India, Austria, Germany, Spain, Chile, Colombia, Peru, Ecuador, Brazil, Israel, and South Africa.

Benchmark Mineral Intelligence, 30/11/2023

UK-based provider of prices and data for the lithium-ion battery supply chain Benchmark Mineral Intelligence will actively look for bolt-on acquisitions to complement its planned organic growth, CEO and Founder Simon Moores said. The company aims to generate 20%-30% of its planned total growth over the next five years through M&A. Potential targets include companies with around 50 employees that generate data that can be cross-pollinated with Benchmark’s existing tools to deliver a new product.

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