Ontario-based Descartes Systems Group, a leading developer of logistics software, announced on June 2 that it has acquired the American trade data provider CUSTOMS Info Inc. for 41.5 million USD in cash and shares. Descartes will borrow $20 million of the $36.1 million cash payment; the remaining $5.4 million consists of 416,437 common shares bearing resale restrictions. Assuming CUSTOMS Info meets its 2014 targets, an additional cash earn-out of up to $3.9 million will be payable in the 2016 fiscal year. Descartes’ share price dropped slightly following the announcement.

Descartes offers logistics solutions using a cloud-based, software-as-a-service model linked to the Global Logistics Network (GLN). The company’s extensive selection of interoperable modular logistics applications has attracted over 170,000 customers who use them on Web-based and wireless devices for planning, scheduling, routing, and tracking shipments and delivery vehicles; handling invoices; filing customs documents; and other logistics needs.

descartes customs info

CUSTOMS Info, which operates out of Salt Lake City, focuses on delivering data on tariffs and duties, trade regulations, trade agreements and rules of origin for use in Global Trade Management (GTM) systems. It also offers comprehensive online trade research tools and SaaS applications for use with classification databases. Its data is used by over 800 international shipping companies to increase supply chain efficiency and ensure compliance with customs requirements. CUSTOMS Info has strategic partnerships with SAP and Oracle, among others.

Descartes was attracted by CUSTOMS Info’s rapid growth and reliable revenue stream, as well as the potential for integrating its data into the Global Logistics Network. That should make the GLN into a more powerful tool for strategic planning and supply chain management, and complement its primary function of coordinating shipments on a daily basis. CUSTOMS Info’s shipping industry clients and GTM partners are also expected to generate additional business for Descartes. For its part, CUSTOMS Info hopes to use Descartes’ Logistics Technology Platform to assist its customers with managing rates, routes, schedules, vehicles, and inventory.