DC Velocity - May 2019

newsmakers

Supply chain systems design and integration firm Fortna Inc. has been acquired by the private equity firm Thomas H. Lee Partners LP (THL), an investment house with other logistics industry holdings that sees big growth prospects in e-commerce and the rising demand for advanced warehouse automation infrastructure.

Terms of the deal were not disclosed, and the transaction is subject to customary closing conditions, Boston-based THL said.

The deal will give West Reading, Pa.-based Fortna the strategic and financial resources to accelerate its growth in the e-commerce sector, including the potential for mergers and acquisitions (M&A) and continued geographic expansion, THL said in a release.

Fortna specializes in distribution strategy, operations design and implementation, material handling automation, and warehouse execution software systems, with a goal of helping clients enhance their distribution operations through reduced operating costs, higher throughput, and improved service.

Those capabilities match up well with a broad market
trend that sees increasing use of automation to handle
business growth in an economic climate where labor is
both hard to find and expensive, Jim Carlisle, managing
director at THL, said in an interview. Because of those
pressures—as well as advances in technology—ware-
house automation has become very compelling from a
return-on-investment (ROI) perspective as companies try
to offset the rising cost of doing business with increased
efficiency in the DC, Carlisle said.

THL plans no organizational changes at Fortna following the acquisition, saying the company would see a “business as usual” approach that will differ only in providing the firm with more resources for expansion. “We intend to invest in their growth, whether on an organic basis or in finding companies [for possible acqui-sitions] that are complementary through geography or capability,” Carlisle said. “We believe in M&A as a driver of value creation for business and as a tool to serve our companies’ customers’ needs.”

Fortna acquired by private equity firm, plans growth in e-commerce and warehouse automation The last mile has become the critical mile in the retail logistics sector, and retailers must adjust their business models accordingly, Lior Sion, chief technology officer for delivery logistics platform Bringg, told attendees in a keynote address at the Home Delivery World conference in Philadelphia in April.

Sion’s comments
underscored the larg-
er theme of the annual
retail logistics industry
event, which focuses
on strategies for imple-
menting, developing,
and improving last-mile delivery in an increasingly
complex business landscape. “We see the age of Amazon
as an opportunity,” added Bringg CEO Guy Bloch, refer-
ring to the online retailer’s dominance in the delivery
market and telling attendees they must “bring technolo-
gy to fight technology.”
Bringg is a delivery logistics technology platform
that allows companies to manage their delivery eco-
systems, whether they
use in-house fleets,
third-party service pro-
viders, or a combina-
tion of both. Although
focused on technolo-
gy, Bringg’s message at
Home Delivery World
was one of relationships:
Retailers must shift their
traditional transac-
tion-focused business model to a model focused on the
customer, Sion and Bloch explained, adding that good
technology is simply a tool for achieving that goal.
—V.K.