May 19, 2017

Descartes pays $14 million for e-commerce fulfillment firm ShipRush

Price could reach $17 million if parcel-shipping platform provider hits revenue targets.

By DC Velocity Staff

Logistics technology provider Descartes Systems Group Inc. is continuing to expand its stable of supply chain software products through a chain of acquisitions, announcing Friday that it had agreed to pay up to $17 million for the parcel-shipping platform provider ShipRush.

Seattle-based ShipRush provides e-commerce, multi-carrier, parcel shipping solutions for small-to medium-sized businesses (SMBs). The company's platform supports integrations with more than 60 business systems, such as commercial enterprise resource planning (ERP), e-commerce, and supply chain systems.

Users, such as omnichannel retailers executing last-mile parcel shipments, can benefit by streamlining their supply chains and can reduce transportation costs by automatically importing orders, comparing carrier rates, printing shipping labels for all major carriers, and tracking through final delivery, ShipRush says.

Waterloo, Ontario-based Descartes will acquire the firm for $14 million in up-front cash, plus a potential $3 million in performance-based bonuses to be paid by 2020. Descartes plans to fold ShipRush into its Global Logistics Network department, alongside other recent acquisitions such as the e-commerce order-fulfillment firms Oz Development Inc. and Pixi Software GmbH, Descartes CEO Edward J. Ryan said in a statement.

Descartes bought Pixi Software GmbH of Germany for $10.4 million in 2016 and Oz Development Inc. of Westborough, Mass., for $29.5 million in 2015. More recently, Descartes in 2016 bought international trade data provider Datamyne Inc. for $52.7 million and data exchange platform supplier Appterra for an estimated $5.8 million, as well as three other logistics software firms in 2015.

"As consumer and business-to-business buying patterns evolve, the parcel shipping market continues to grow in size and importance," Descartes EVP of Product Management Ken Wood said in a release. "Without a comprehensive omnichannel strategy that includes advanced parcel-shipping capabilities, e-commerce retailers and SMBs alike can be left with escalating costs and poor delivery execution that can impact customer satisfaction. ShipRush's solutions help address this problem."

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