- Panasonic will acquire supply chain software company Blue Yonder in a deal valued at $7.1 billion, the firms announced Friday. The figure includes Panasonic's purchase of the remaining 80% of shares in Blue Yonder for $5.6 billion, plus debt repayment.
- The acquisition brings together Blue Yonder's end-to-end supply chain software, which uses artificial intelligence, with Panasonic's autonomous solutions, to form "autonomous enhancement of the whole supply chain," according to slides from Panasonic.
- Friday's deal follows Panasonic's move to take a 20% stake in Blue Yonder in July 2020. The two also formed a joint venture in 2019. "This acquisition brings the strategic relationship full circle," the press release stated.
By combining forces, Panasonic and Blue Yonder "connect the digital and physical layers," read the slides from Panasonic, accompanying the acquisition announcement.
Blue Yonder is among the largest supply chain software providers globally, with customers including Unilever, DHL, P&G and Coca-Cola. Gartner dubbed the firm a leader in its magic quadrant for supply chain planning solutions.
Meanwhile, Panasonic produces several hardware products, including sensor technology and edge devices (such as gadgets and wearables).
The slides laid out examples of Panasonic's hardware tech working in tandem with Blue Yonder's Luminate platform.
Sensors on the factory floor could relay data on stock status into the Luminate Planning software, which would then feed into the control tower. From there, the control tower would provide instructions on how to adjust production.
Devices in the warehouse would send delivery and sorting-status information to Luminate Logistics and then the control tower, which would return with insights on real-time sorting.
The Panasonic-Blue Yonder deal comes at a time of heightened need for real-time data and automated solutions, due to the pandemic and growth of e-commerce. Forecasts went out the window, and planning cycles became more frequent. E-commerce parcel volumes strained logistics networks and warehouses sorting the goods.
Data and analytics is expected to become a core business function this year, as supply chains adjust operations in the face of disruptions. Arguably, it was already core to supply chains producing or procuring essential goods during the pandemic, with data providing critical insights into stocks of personal protective equipment, for example.
Panasonic and Blue Yonder have worked together on supply chain solutions in the past, as part of a joint venture and partnership.
One of the joint solutions is for parcel sorting. It uses scanning tech and image projection, then links the data to a central system, which allows warehouse managers to adjust shipping and personnel based on real-time throughput data. Another tool sends stockout data from retail stores in real time up the supply chain to factories and warehouses.
Panasonic said it views the acquisition of Blue Yonder as a way to reduce operational waste in the supply chain, by ensuring processes run as efficiently as possible.
"We would like to realize a world where waste is autonomously eliminated from all supply chain operations," Panasonic CEO Yuki Kusumi said in a statement. "There are still many such losses and stagnation in supply chain operations."
The boards of directors at each company have approved the acquisition, and it now awaits regulatory approvals. The firms expect the deal to close in the second half of the year.