The M&A Category

Almost Famous: Ivalua Acquires Directworks

Confirming the spend management industry rumor mill, Ivalua today announced its acquisition of Directworks. The deal lends serious credence to Ivalua’s tag line — “One Suite. Infinite Possibilities” — as it has the potential to establish Ivalua as the market’s only native, end-to-end S2P solution.

In terms of indirect spend know-how, Ivalua is a thought leader and its software is top drawer. On the direct side, Directworks goes deep, delivering Ivalua an arsenal of hard-won intellectual property based on battle-tested experience.

WorkMarket’s Acquisition of OnForce: Why It Takes a Village, Not Uberization [PRO]

We recently covered WorkMarket’s acquisition of field services execution platform OnForce from the staffing industry giant Adecco Group. While this M&A activity could easily be viewed as just a “tuck in acquisition” (into WorkMarket’s field services solution vertical), it is really more than that. Considering the comprehensive deal and its context provides a different perspective on the strategic development of this particular digital work platform, as well as on digital work platforms in general.

This Spend Matters PRO brief addresses HR and contingent workforce procurement practitioners who are trying to understand the emergence of digital work platforms and the ongoing transformation of the enterprise and the execution of work. It provides an overview and introduction to OnForce and WorkMarket, offers sector definitions to cut through the jargon and introduces the different components of the field services contractor management technology market as well as alternative providers.

Finally, it offers analysis on the future of the OnForce/WorkMarket combination and the future of online work intermediation platforms in general — and why collaboration and ecosystem relationships are key to driving change in established B2B industries.

Taking Inventory of Proactis and Perfect Commerce: Products, Strengths and Integration [PRO]

Proactis and Perfect Commerce share a number of commonalities, perhaps the three most important being that they have built out similar product footprints, have been able to grow “under the radar” in recent years and have leveraged M&A as a core growth strategy. We covered the news of the announced merger between the two firms last Friday on Spend Matters, and Proactis shareholders initially responded positively to the news.

As background, Proactis’ core source-to-pay (S2P) business has centered primarily on serving U.K. customers, with a concentration in public sector. In the U.K. market, Proactis has made a number of acquisitions in recent years to round out its suite and to acquire market share. These transactions include EGS (2014), Due North (2016) and Millstream (2016). Within the U.S., it acquired Intesource (2014), to strengthen its e-sourcing and related managed services capability, and Intelligent Capture (also 2014), a provider of electronic invoicing and scan/capture services.

Perfect has served customers in the S2P area on a global basis since its founding, in 1994, but with a greater emphasis, until recently, on North America. It has made a number of smaller acquisitions over the years, in addition to its foundational acquisition of Commerce One (2006), including those that leveraged IP enforcement of Commerce One code as a bargaining chip in various transactions. But more recently, Perfect made its largest acquisition to date purchasing supplier network and P2P provider Hubwoo, to help expand its market presence and enhance its capabilities in the catalog management, marketplace and supplier network areas.

This Spend Matters PRO research brief provides an introduction and an overview to both providers, exploring the value proposition and strengths each vendor brings to the combination, including overlap and potential synergies from a customer perspective. It also touches on the subject of integration, as well as the approach we would encourage customers to look for when determining whether the acquisition will primarily benefit them or investors.

Proactis Acquires Perfect Commerce: Something is Fishy (in a Good Way)

U.K.-based spend management and e-procurement solution provider Proactis announced Friday it’s snapping up Perfect Commerce, a U.S.-based source-to-pay (S2P) provider. Assuming shareholder approval, the new company, which will be called Proactis, will be one of the largest global cloud-based spend management companies, according to the announcement. The $132.5 million deal (in aggregate consideration) roughly doubles Proactis’ revenue.

Sycamore Partners to Acquire Staples: What is the Broader Strategy Here?

Private equity firm Sycamore Partners announced Wednesday that it would acquire office supply company Staples for $6.9 billion, though rumors of the deal had been swirling for a week. The acquisition comes after the Federal Trade Commission quashed a Staples-Office Depot merger on antitrust grounds a year ago, which Spend Matters covered extensively.

Coupa’s Acquisition of Trade Extensions — Sometimes It’s Better to Be Lucky

Does Coupa understand what it just bought in the form of Trade Extensions, that little sourcing optimization company from a sleepy college town north of Stockholm?

Don’t bet on it. But don’t worry, they’ll figure it out soon enough.

Several of us ruminated on the possibilities over happy hour at Coupa Inspire, so I’d thought I’d share two of the highlights, the inside (and ever-so-slightly-inebriated) analyst view if you will.

Trade Extensions and Coupa Acquisition Analysis: Customer and Partner Recommendations [PRO]

Tradeshift Baiwang

This Spend Matters PRO brief, part of a series analyzing Coupa’s acquisition of Trade Extensions (see also here and here), provides recommendations for Trade Extensions and Coupa customers and partners surrounding the acquisition. 

Spend Matters has spoken or met with many of Trade Extensions’ largest customers in recent years (most of which prefer to remain unnamed) and the most advanced organizations view it as the tool that affords the highest degrees of competitive advantage across the procurement technology spectrum relative to peers in as much as how it is used than what it has the potential to do. This is key. In fact, there are material levels of diversity among Trade Extensions users even in the same industry. Many customers expose some parts of Trade Extensions’ potential yet could get away with another optimization solution for at least some of their events, if not all. Yet best-in-class procurement organizations unleash its full potential to drive competitive sourcing and supply chain advantage.

Whether you view Trade Extensions and sourcing optimization at this level or more tactically, this Spend Matters PRO brief provides insight and recommendations into the combination of the two providers. It is divided into three sections: Trade Extensions customer recommendations, Coupa customer recommendations and partner recommendations.

Coupa to Acquire Trade Extensions: Solution and Market Analysis [PRO]

data analytics

This Spend Matters PRO brief provides a solution and market analysis of Coupa’s announced acquisition of Trade Extensions. Based on subscriber feedback, we’ve already been asked to go into details about what makes Trade Extensions’ optimization capability different from Jaggaer ASO (formerly CombineNet), BravoSolution, Keelvar, Determine/Iasta and Emptoris (IBM).

In addition, this brief offers a broader market-based analysis of the acquisition. As always, we invite Spend Matters PRO advisory customers to reach out to us for more insight behind our thinking and also to discuss if Trade Extensions is right for them (as well as alternatives). We will publish a separate customer and partner analysis PRO research brief later this week.

Given our knowledge and background in this market, we tried to think of an analogy to describe the combination of Coupa and Trade Extensions’ strategic sourcing capability. We think we’ve got a good one. However, we’ll share this analogy at the end of this research brief. First, to focus on what really matters, we’ll delve into some of the less superficial solution, customer and market analysis.

Coupa Enters an Agreement to Buy Trade Extensions: A Game Changing Move For Strategic Sourcing

After market close on Friday, Coupa announced it had entered into an agreement to purchase Trade Extensions, a specialist e-sourcing and strategic sourcing optimization vendor.

Coupa will pay $45 million for Trade Extensions when the transaction closes — $41 million will be paid in cash and $4 million in stock (which will be issued, it appears, to employees). Spend Matters estimates the valuation range for Trade Extensions (as a multiple of revenue) is in line with other typical SaaS companies, and that Coupa did not pay a premium for Trade Extensions, especially considering how unique the asset is in the market.

Google M&A: “Taking On” Kaggle, A Crowd Contest Data Science Platform

Tradeshift Baiwang

Google recently announced its acquisition of San Francisco-based Kaggle. Founded in 2010, Kaggle describes itself a platform for predictive modeling and analytics competitions and consulting. Organizations and individuals may submit projects as contests and set a monetary prize for solutions. Individuals or teams within Kaggle’s crowd of 600,000 data analytics experts propose solutions, and the originators of the projects select a winner and award the prize money. Kaggle also offers a talent solution that allows organizations to find and evaluate potential hires based on their actual projects and code. Small to large companies across a range of industries have used Kaggle — including State Farm, Facebook and Google, which used Kaggle extensively before the acquisition

Tradeshift and IBX: Partner, Customer and Competitive Analysis [PRO]

change of control clauses

The combination of Tradeshift and IBX changes the procure-to-pay (P2P) competitive landscape. Last week, we reported on the transaction and offered an initial analysis of what IBX will bring to Tradeshift. This Spend Matters PRO research brief provides an initial analysis for current and potential customers and partners of Tradeshift and IBX. It also provides insight and analysis on how the transaction will alter the competitive landscape.

Solution Analysis: What IBX Brings to Tradeshift and How the Combined Provider Stacks Up [PRO]

Tradeshift announced earlier this week it would acquire IBX Business Network from Capgemini, the previous owner of the procurement technology and supplier network provider. Spend Matters analysts Xavier Olivera and Jason Busch recently had the chance to speak to the Tradeshift team about the acquisition. They, along with other members of the Spend Matters research team, have spent time reviewing IBX’s source-to-pay solution in detail.

This Spend Matters PRO analysis provides an expert solution perspective on what IBX brings to Tradeshift, including IBX’s strengths in the e-procurement area. It also provides a brief discussion on how Tradeshift plans to integrate IBX into its solution portfolio, including planned (rapid) migration. Finally, it includes a March 2017 SWOT framework and March 2017 summary company analysis and graphical comparative overview of Tradeshift’s solution footprint and capability (inclusive of IBX) across the source-to-pay continuum in the sourcing, analytic, contract management, supplier management, e-procurement and invoice-to-pay functional areas.

Additional Spend Matters PRO analysis to follow in a subsequent research brief will include customer recommendations, partner recommendations and an analysis of the changing competitive landscape for source-to-pay suites, networks and platforms. Additional Spend Matters news coverage will share what we learned from our discussions with the Tradeshift team following the announcement.