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Sale of Vend for US$350 Million

Today Lightspeed announced that it will acquire Vend for US$350 million ($485m in NZD at Friday’s exchange rate). The press release is below, and there is also a Lightspeed investor presentation.

The sale was covered by NZHerald (and here), Stuff and NBR. Following the announcement the price of the  Lightspeed shares rose, which, if sustained, will add to the value of the transaction in dollar terms.

Here’s Lightspeed’s Press Release (all in USD):

Omnichannel commerce leader grows customer base by more than 20,000 customer locations worldwide, entrenches leadership position in Asia-Pacific

MONTREAL, March 11, 2021 /CNW Telbec/ – Lightspeed POS Inc. (NYSE: LSPD) (TSX: LSPD), a leading provider of cloud-based, omnichannel commerce platforms, today announced it has entered into a definitive agreement to acquire Vend Limited (Vend), a cloud-based retail management software company. The acquisition strengthens Lightspeed’s global retail base and reinforces the company as a premier omnichannel retail platform worldwide for high-performing small and medium-sized businesses.

The acquisition also builds on Lightspeed’s foothold in Asia-Pacific, approximately doubling the company’s customer base and expanding its retail footprint in that region. The combination of Lightspeed with the talent and technology of Vend, widely acknowledged as providing one of the foremost retail products on the market, will help to further growth by ultimately providing the Vend customer base access to the company’s broader commerce solutions, such as Lightspeed Payments, Lightspeed eCommerce, Lightspeed Loyalty, as well as future access to the Lightspeed Supplier Network.

Subsequent to the closing of the acquisition, Lightspeed will serve as the technology partner of choice for over 135,0001customer locations2 worldwide as small and medium-sized businesses increasingly turn to the company’s innovative, cloud-based platforms ahead of highly-anticipated economic reopenings in both the retail and hospitality industries. Building on the landmark acquisition of ShopKeep, Lightspeed intends to leverage Vend’s complementary modern technology stack and user experience capabilities to continue to deliver the most advanced commerce capabilities to retailers around the world.

“Lightspeed’s mission is to ignite the potential of businesses to enrich the communities they serve, whether they are beloved local neighborhoods or the thriving metropolitan cities we are eager to see bustling with crowds once again,” said Dax Dasilva, Founder and CEO of Lightspeed. “We are thrilled to partner with Vend, a team that matches Lightspeed’s passion for retail. That combined drive will position our global retail base of high-performing businesses for success as they emerge from a truly transformational period in the history of modern commerce.”

“Lightspeed’s global excellence and commitment to community is inspirational to Vend,” says Ana Wight, CEO of Vend. “By joining forces, we will power the global transformation of retail and pour our unparalleled collective efforts into the success of our retailers at this pivotal moment in our industry. As a New Zealand-based company, we’re proud to be globally recognized for the product and company we have built and are excited about this next step in our journey.”

Details of transaction:

Vend generated revenue of approximately $34 million and GTV3 of more than $7 billion in the trailing twelve month period ending December 31st, 2020. Lightspeed will acquire Vend for total estimated consideration of approximately $350 million, satisfied by way of payment on closing of approximately $192.5 million in cash and the issuance of subordinate voting shares in the capital of Lightspeed valued at approximately $157.5 million. The deal, which is subject to customary closing conditions and post-closing working capital adjustment, is expected to close towards the end of April, subject to the receipt of applicable regulatory approvals.

About Lightspeed

Lightspeed (NYSE and TSX: LSPD) powers complex small and medium-sized businesses with its cloud-based, omnichannel commerce platforms in over 100 countries. With smart, scalable and dependable point of sale systems, Lightspeed provides all-in-one solutions that drive innovation and digital transformation within the retail, hospitality and golf industries. Its product suite enables SMBs to sell across channels, manage operations, engage with consumers, accept payments and ultimately grow their business.

Headquartered in Montreal, Canada, Lightspeed is trusted by favorite local businesses worldwide, where communities go to shop and dine. Lightspeed has staff located in North America, Europe, and Australia.

For more information, please visit: lightspeedhq.com


Deal Terms

The deal is subject to New Zealand’s Overseas Investment Office approval and the equivalent in Australia. We see no reason why this would be withheld. We are holding off on too much commentary until after final closure.

Impact on Punakaiki Fund

The value of the deal represents 2.2x times our current holding value for Vend – with our holding value rising from just over $3.5 million to around $8 million. This represents over $1 of investor net asset value per share, and should send the total fund value past $70 million.

There is still uncertainty about the result though as there are a number of moving parts that are still unknown. These include the final percentage of shares that we receive versus cash, what happens to the Lightspeed share price and thus the number of shares issued and the holding value over time, the USD/NZD exchange rate, and any final adjustments. We will share any material news with you as we learn more, as well as more detailed analysis over time.

Impact on New Zealand

Obviously this is a big announcement for Vend, founder Vaughan Fergusson and his family, and the large number of investors as well as participants in the employee share ownership plans. Many of the latter did not know about this until today, or will only now be finding out. We are delighted for everyone.