Panasonic to Acquire US Blue Yonder for 7.3 Trillion Won

Largest M&A Since 2011
Strengthening Software... Hardware Synergy

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Cho Hyun-ui] Japan's Panasonic has decided to acquire Blue Yonder, a US supply chain management software developer, for 700 billion yen (approximately 7.34 trillion won). This is Panasonic's largest-ever merger and acquisition (M&A) since fully incorporating Sanyo Electric and Panasonic Electric Works as subsidiaries in 2011.

On the 9th, Nihon Keizai Shimbun reported this citing multiple sources. Blue Yonder is a digital solution provider that uses artificial intelligence (AI) to predict product demand and delivery times, improving profitability through supply chain review. It serves about 3,300 companies worldwide, including Unilever and Walmart.

Through this acquisition, Panasonic plans to transform its business model by combining software with hardware products to increase added value. Panasonic aims to enhance the value of its products by integrating Blue Yonder's supply chain management software with its store surveillance cameras, which have a high market share, and barcode reading terminals used in logistics facilities. Nihon Keizai Shimbun evaluated, "The new business model will accelerate manufacturing."

Panasonic has been expanding the scope of its hardware business by strengthening its service and solution business early on. In May last year, it invested 86 billion yen in Blue Yonder to acquire a 20% stake, and it is currently in final discussions to purchase the remaining shares held by US private equity firms Blackstone and New Mountain Capital.

In the global manufacturing market, the trend is to enhance hardware products by utilizing software. The global supply chain software market size was estimated at 15 billion dollars in 2019 and is expected to grow at an annual rate of 10%.

Nihon Keizai Shimbun said, "As hardware-centric companies digitalize, demand for related software is increasing," adding, "Germany's Siemens also enhanced the functionality of its factory control equipment in this way to improve profitability."

This content was produced with the assistance of AI translation services.