Pitney Bowes buys order fulfillment and logistics provider Newgistics for nearly $475 million

As reported by Digital Commerce 360
Wednesday, September 6, 2017

Newgistics’ strong working relationship with the U.S. Postal Service was a key reason for the acquisition, Pitney Bowes says.

Global e-commerce technology provider Pitney Bowes Inc. has acquired online order fulfillment and logistics provider Newgistics for about $475 million.

The deal is set to close later this year by no later than early fourth quarter, according to Pitney Bowes, which made the announcement Wednesday afternoon. Newgistics’ relationship with the U.S. Postal Service—it processes 100 million packages through the USPS each year—is a primary reason for the acquisition, Pitney Bowes said.

“Newgistics fits uniquely at the intersection of our parcel growth strategies and will accelerate the overall transformation of Pitney Bowes,” Pitney Bowes CEO Marc Lautenbach said.

The USPS on its website lists both Pitney Bowes and Newgistics among its approved shipping consolidators, which means small to medium-sized businesses can use those vendors’ services in order to receive volume shipping discounts that would otherwise be unavailable.

Fitch Ratings writes that the acquisition makes sense for Pitney Bowes, given the company’s overall strategy.

“Newgistics’ focus on order fulfilment, nationwide parcel delivery and return, and managing digital commerce ecosystems enhances PBI’s existing global e-commerce offerings while also enhancing and broadening PBI’s domestic ecommerce and presort offerings,” Fitch writes. “The acquisition should also provide significant synergy opportunities given the complementary nature of the businesses and minimal customer base and business focus overlap.”

According to Top500Guide.com, Pitney Bowes is the international e-commerce and fulfillment services provider to 74 retailers in the Internet Retailer 2017 Top 1000.
 
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Ken Wood is the founder of LJM Consultants. LJM helps clients negotiate “Best in Class” UPS/FedEx agreements. LJM was recently named the “best parcel auditing company in America” and was also inducted into Inc. Magazine’s Top 500/5000 fastest growing companies in America for 2013. To learn how LJM Consultants can help your company get the parcel contract you deserve, call 631-844-9500 or email kenwood@myLJM.com.