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Wisetech Global Limited (ASX:WTC), a provider of software solutions to the logistics industry globally, has announced the completion of Containerchain acquisition, which is a solution provider of leading container optimization for shipping container and landside container logistics communities in the regions of Asia Pacific, Europe and the United States.
Containerchain is a market leader for providing containerized solutions in Australia, Singapore as well as New Zealand and is headquartered in Singapore. Containerchain is soon to expand into Belgium, France, Germany, Malaysia, Netherlands, and the United States.
The solution provided by Containerchain focuses on providing real-time tracking, automation, operational planning, connectivity as well as container visibility across the entire supply chain. Moreover, the company covers an import and export notification of more than 5 million on an annual basis.
 âContainerchain helps to digitize and optimize container depot operations along with gate slot-bookings as it is a valuable connector technology initiative.â This was acknowledged by the Founder & CEO, Mr Richard White of the WiseTech Global in his latest statement.
Adding these adjacent technologies to the Wise Tech portfolio of execution capabilities for 2PL and 3PL will further help in facilitating CargoWise Nexus, which is WTCâs new platform under development. It will also add strategic value in container management technology and expertise of the team. It will also create connectivity across landside communities and will also help in penetrating the Australia, New Zealand and Singapore market. Thus, the acquisition of Containerchain will help the company to further expand its offerings, and they will also be able to reach new customer segments.
There is an incredible opportunity for WTC with the acquisition of Containerchain as it will lead to efficient future growth for the entire group. The groupâs powerful innovation capacity across 20 development centres across the world along with its significant operational capacity will lay a foundation for commercial engagement to pitch into the new market. The acquisition will benefit the newer container communities beyond Australia and Singapore as well as other 12,000 organizations who are using the logistic solutions provided by Wisetech.
Earlier, the company was able to track more than 12 million ocean containers on an annual basis. This acquisition will enable the company to enhance visibility, notifications as well as the potential to make decision domestically on both ends of the container chain.
To facilitate the exit of the existing portfolio investors, the company has invested approximately A$92 million in cash which was funded through the existing group resources. The accounts of Containerchain is expected to be consolidated into WTCâS accounts from April 2019. With the Containerchainâs core operations in Australia, New Zealand and Singapore and with their significant market penetration and established technology, the company would be able to deliver a strong revenue followed by significant cash flow generation which will be used to fund the development activities for the emerging US and EU market.
Along with the previous acquisitions in various locations of the world, the recent acquisition of Containerchain is in line with the stated strategy to accelerate long-term organic growth through targeted, valuable acquisitions.
Taking these transactions in the account, the company has provided guidance for FY2019 revenue and FY2019 EBITDA. The company expects its revenue to be in the range of $326 million â $339 million and the EBITDA to be in the range of $100 million - $105 million.
In the last six months, the stock has generated a negative return of 11.54%. However, its YTD return has been 7.16%. On 27 February 2019 (1:50 PM), the stock is trading at A$18.480, up by 1.26%. The company has a market capitalization of A$5.49 billion with approximately 301.09 million outstanding shares and a PE ratio of 112.650x.
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