Lightspeed POS Inc. is continuing its acquisition spree and efforts to consolidate the e-commerce industry with a pair of deals valued at US$925 million.
The Montreal company, which sells software for small- and medium-sized retailers and restaurants, announced Monday that it will buy e-commerce company Ecwid and wholesale software business NuOrder.
“By joining forces with Ecwid and NuOrder, Lightspeed becomes the common thread uniting merchants, suppliers and consumers, a transformation we believe will enable innovative retailers to adapt to the new world of commerce,” said Lightspeed founder and chief executive Dax Dasilva, in a release.
Under the first deal, Lightspeed will buy Encinitas, Calif.-based Ecwid for US$$500 million, including US$175 million in cash and US$325 million in Lightspeed shares.
Ecwid, which was founded in 2009 to enable small businesses to easily add online stores to their existing sites, boasts about having 130,000 paying customers across more than 100 countries.
READ MORE: Montreal tech company Lightspeed expands business to suppliers
The second deal will see Lightspeed pay US$425 million, including half in cash and half in Lightspeed shares, for Los Angeles-based NuORDER, a business-to-business e-commerce platform.
NuOrder has worked with more than 3,000 brands including Coach, Converse, Canada Goose, Steve Madden, JW Anderson and Helmut Lang.
In a call with analysts just after the deal was announced, Lightspeed explained that buying Ecwid allows it to offer clients easy-to-use tools they can use to quickly sell online and unify their digital and physical operations.
Meanwhile, NuOrder has a high concentration of apparel brands it works with and will open up financial services opportunities to Lightspeed.
In the last two years, Lightspeed has purchased restaurant software company Upserve, cloud-based retail management software company Vend Ltd. and ShopKeep, which helps restaurants and retailers accept payment and manage their business.
Lightspeed President Jean-Paul Chauvet acknowledged on the analyst call that his company is paying a bit more for Ecwid and NuOrder than it had for previous businesses.
The amounts Lightspeed agreed to for Ecwid and NuOrder, he said, were about 15 times the forward revenue for each, “which we think, given the success and the momentum these businesses have, is appropriate in the current context.”
“In terms of upside, we see lots of upside here to getting access to very large customer bases from each, the payments opportunity we mentioned as well,” he said.
He added the deals are “as much about cementing the strategy of the business for the next five years as anything else.”
Both deals, which are subject to customary closing conditions and require regulatory approvals, are expected to close during the quarter ended Sept. 30, 2021.
The closing of the two acquisitions are not contingent on each other, Lightspeed said.
Lightspeed’s shares increased by just over two per cent or two dollars in morning trading to reach $88.72.
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