SPS Commerce to Acquire TIE Kinetix
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SPS Commerce to Acquire TIE Kinetix

CIO Review

MINNEAPOLIS, -- SPS Commerce, Inc. (NASDAQ: SPSC), a leader in retail cloud services, today announced that it has reached an agreement to acquire TIE Kinetix, a leading provider of supply chain digitalization including EDI and e-invoicing in Europe. The transaction is subject to customary closing conditions, including the approval of the shareholders of TIE Kinetix N.V.

“We are looking forward to welcoming TIE Kinetix employees and customers to our growing network of trading partners around the world,” said Archie Black, CEO of SPS Commerce. “With the acquisition of TIE Kinetix, SPS Commerce is strengthening its e-invoicing capabilities, while expanding our European presence to serve our growing network with access to international markets.”

“We are excited to join SPS Commerce and leverage TIE’s e-invoicing capabilities to capitalize on the opportunity presented by mandatory e-invoicing regulations across Europe,” said Jan Sundelin, CEO of TIE Kinetix. “Our offering will complement SPS’ next generation EDI solution and competitively position the combined company across the B2B and B2G markets.”

Acquisition Details

SPS Commerce is set to acquire the TIE Kinetix business for approximately €64.5 million, net of cash acquired, as per the terms of the purchase agreement. TIE Kinetix, established in 1987, is publicly traded on NYSE Euronext under the symbol TIE and has its headquarters in the Netherlands, with employees also located in France, Germany, and the United States.

TIE Kinetix will promptly convene an extraordinary general meeting of shareholders to vote on the transaction, among other matters.

The acquisition is expected to be completed in the third quarter of 2023, subject to the fulfillment of customary closing conditions. Until the closing, both companies will continue to operate independently.

SPS Commerce intends to finance the acquisition using its available cash.

Regarding the financial impact of the acquisition, SPS Commerce provided preliminary information based on current expectations:

● In the third quarter of 2023, the acquisition is projected to have a nominal impact on expected financial results, except for approximately $1 million in certain one-time deal-related costs.

● In the fourth quarter of 2023, the acquisition is anticipated to contribute about $3.9 million in revenue, with the acquired business's Adjusted EBITDA expected to be approximately ($500,000).

● For fiscal year 2024, the acquisition is expected to generate around $16.0 million in revenue and at least breakeven in Adjusted EBITDA.

●In fiscal year 2025, the acquisition is projected to contribute $2 million to $3 million to Adjusted EBITDA.

It is important to note that forward-looking measures and underlying assumptions involve significant known and unknown risks and uncertainties, and actual results may differ materially. Due to the uncertainty and complexity of predicting certain items within a reasonable range, the Company does not provide a reconciliation of the forward-looking non-GAAP financial measure, Adjusted EBITDA, to the most directly comparable GAAP financial measure, net income.

Further details on the acquisition will be provided during the Second Quarter Earnings conference call scheduled for July 27, 2023.

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