DEFM14C: E2open Shareholders to Receive $3.30 Per Share in All-Cash Acquisition by WiseTech Global

E2open Parent Holdings, Inc. is set to be acquired by Australian logistics software provider WiseTech Global Limited for $3.30 per share in an all-cash transaction, following approval by a majority of E2open's voting stockholders.

Summary

• E2open Parent Holdings, Inc. (E2open) will be acquired by WiseTech Global Limited (Parent) for $3.30 per share in an all-cash transaction.
• The acquisition involves two mergers: Company Merger Sub into E2open, and Holdings Merger Sub into E2open Holdings, LLC, with both E2open and Holdings surviving as wholly-owned subsidiaries of Parent.
• Each outstanding share of Class A Common Stock, Series B-1 Common Stock, and Series B-2 Common Stock will be converted into the right to receive $3.30 in cash.
• Class V Common Stock will be cancelled without consideration.
• Outstanding Company warrants will become exercisable for the Per Share Price, with a potential reduction in warrant price if exercised within 30 days of public disclosure of the merger's consummation.
• Company Options with an exercise price less than $3.30 will be cashed out based on the difference between the Per Share Price and the exercise price.
• Vested Company RSUs, Director RSUs, and Specified RSUs will be cashed out at the Per Share Price.
• Other Company RSUs and PSUs will be converted into Parent restricted stock unit awards, covering Parent ordinary shares based on an Equity Award Exchange Ratio, or into restricted cash awards for individuals in Restricted Cash Jurisdictions.
• A Tax Receivable Agreement (TRA) Amendment was executed, reducing E2open's early termination payment obligations under the TRA by approximately $52.5 million, which corresponds to an estimated $0.15 per share of incremental value reallocated to E2open's stockholders.
• The merger was approved by written consent from Principal Stockholders, representing approximately 53.76% of the aggregate voting power, eliminating the need for a stockholder meeting.
• The transaction is not subject to a financing condition, as Parent has committed sufficient funds.
• E2open's Class A Common Stock will be delisted from the NYSE and deregistered under the Exchange Act upon completion of the mergers.

Sentiment

Score: 8

Explanation: The sentiment is highly positive for E2open shareholders due to the significant premium offered, the all-cash nature of the deal providing immediate liquidity and certainty, and the favorable amendment to the Tax Receivable Agreement which directly increased the per-share value. The board's extensive strategic review process and the deteriorating financial forecasts for the standalone company further support the attractiveness of this acquisition for shareholders, despite the loss of future participation.

Positives

• The Per Share Price of $3.30 represents a significant premium of approximately 68% over the closing price of Class A Common Stock on April 30, 2025 (unaffected date) and 28% over the closing price on May 23, 2025 (day prior to announcement).
• The all-cash consideration provides immediate liquidity and certainty of value to E2open stockholders, eliminating long-term business and execution risks.
• The TRA Amendment reduced the early termination payment obligations by approximately $52.5 million, effectively increasing the per-share merger consideration by an estimated $0.15 for all stockholders.
• The transaction is not subject to a financing condition, reducing closing risk.
• Parent has a strong track record of completing acquisitions, enhancing the likelihood of consummation.
• The Board conducted an extensive 18-month strategic review process, engaging with over 50 potential counterparties, concluding that this offer was the most favorable available.

Negatives

• E2open will cease to be a standalone public company, meaning existing stockholders will not participate in any future earnings or growth of E2open or appreciation in its value.
• The company's financial forecasts (January 2025 and April 2025) showed declining revenue and Adjusted EBITDA estimates compared to earlier 2024 forecasts, indicating deteriorating standalone prospects.
• There is a risk of disruption to E2open's business operations, stock price, and relationships with stakeholders due to the announcement and pendency of the mergers.
• If the mergers are not completed, E2open will incur significant transaction expenses and opportunity costs, and its stock price may decline.
• The Merger Agreement restricts E2open's ability to take certain actions without Parent's consent, potentially limiting business opportunities during the pendency of the mergers.
• The transaction will be a taxable event for U.S. federal income tax purposes for Class A Common Stock holders.
• The Merger Agreement included a provision for a $37,500,000 termination fee payable by E2open to Parent under certain circumstances, such as failure to obtain stockholder consent or termination due to E2open's breach.

Risks

• The proposed transaction may not be completed in a timely manner or at all, which could adversely affect E2open's business and stock price.
• Failure to satisfy closing conditions, including receipt of regulatory approvals from various governmental entities, could prevent the merger.
• The occurrence of any event, change, or circumstance that could lead to the termination of the Merger Agreement, potentially requiring E2open to pay a termination fee.
• Risks that the proposed transaction disrupts current plans and operations, diverting management's attention.
• Challenges in retaining, hiring, and integrating skilled personnel, including the senior management team, and maintaining relationships with key business partners and customers.
• Unexpected costs, charges, or expenses resulting from the proposed transaction.
• The impact of adverse general and industry-specific economic and market conditions, including inflation, interest rate fluctuations, and geopolitical instability.
• The inability to realize the value of goodwill and intangible assets, potentially leading to impairment charges.
• The slowing of E2open's growth rate due to lower than anticipated new bookings and higher than expected churn.
• Risks associated with international operations, including geopolitical instability.
• The failure of the market for cloud-based SCM solutions to develop as quickly as expected or failure to compete successfully in a fragmented and competitive SCM market.
• Cyber-attacks and security vulnerabilities.
• Potential litigation arising from stockholders in respect of the Merger Agreement or transactions contemplated by it.

Future Outlook

The merger is expected to be completed in the second half of 2025, subject to satisfaction or waiver of closing conditions, including regulatory approvals. Upon completion, E2open will cease to be a publicly traded company, and its Class A Common Stock will be delisted from the NYSE and deregistered. The company's future operations will be as a wholly-owned subsidiary of WiseTech Global.

Management Comments

• The Board unanimously determined that entering into the Merger Agreement and consummating the Company Merger is fair to, and in the best interests of E2open and its stockholders.
• The Board considered that the Per Share Price of $3.30 represents a significant premium to recent and historical market prices of Class A Common Stock.
• The Board noted that the all-cash Per Share Price provides certainty and immediate liquidity, eliminating long-term business and execution risk.
• The Board believed that Parent's proposal represented the highest price per share of Class A Common Stock that Parent was willing to pay and the most favorable terms to E2open.
• The Board considered the reduction in TRA early termination payments, which resulted in an increase in the consideration available to be paid to E2open's stockholders.
• The Board acknowledged that the full realization of the Company's financial forecasts was subject to significant execution risk if it were to remain an independent public company.

Industry Context

E2open is a world-class provider of cloud-based, end-to-end supply chain management (SCM) and orchestration software, serving approximately 5,600 clients globally. WiseTech Global is a leading provider of logistics execution software solutions, with over 16,500 customers across 195 countries, including top global third-party logistics providers and freight forwarders. This acquisition combines E2open's SCM platform with WiseTech's logistics execution expertise, aiming to create a more integrated and comprehensive supply chain solution. The transaction reflects ongoing consolidation and strategic alignment within the supply chain and logistics software industry, driven by the need for end-to-end visibility, efficiency, and resilience in modern supply chains.

Comparison to Industry Standards

• The Per Share Price of $3.30 implies an enterprise value to Adjusted EBITDA multiple that Rothschild & Co compared to selected public companies in supply chain management software (WiseTech Global, Manhattan Associates, Descartes Systems Group Inc., SPS Commerce, Inc., Kinaxis Inc.) and financial software (Zoom Communications Inc., SS&C Technologies Holdings, Inc., Akami Technologies, Inc., OpenText Corporation, ZoomInfo Technologies Inc., Blackbaud, Inc.).
• Rothschild & Co's analysis of selected public companies yielded an implied EV/Adj. EBITDA (less capitalized software) range of 9.2x to 12.7x for CY2025E and 8.9x to 11.9x for CY2026E, which the Per Share Price falls within or near, depending on the specific forecast and multiple applied.
• The discounted cash flow analysis by Rothschild & Co resulted in an implied per share equity value range of $1.34-$4.32, indicating the $3.30 offer is within this valuation range.
• Selected equity analyst target prices for E2open Class A Common Stock between April 29, 2025, and May 19, 2025, ranged from $2.00 to $2.50, making the $3.30 offer a significant premium to these targets.
• Premiums paid in selected precedent cash consideration transactions (U.S. listed targets, $2B-$5B enterprise value, May 2020-May 2025) ranged from 29.2% to 57.5% (25th to 75th percentile) relative to the target company's one-month prior closing price. Applying this to E2open's April 30, 2025, closing price of $1.97, the implied price range was $2.55 to $3.10, suggesting the $3.30 offer is at the higher end or above this comparable range.

Management Changes

Corporate Governance

Legal Proceedings

• As of the filing date, E2open is not aware of any complaints filed or litigation pending related to the Mergers, but acknowledges that lawsuits may be filed in the future.
• The Company settled a legal proceeding related to a 2014 software licensing and service contract dispute with a customer for $17.8 million in September 2023, which resolved the matter and released the Company from all alleged claims.

Related Party Transactions

• The completion of the business combination in February 2021 resulted in related party relationships between CCNB1 and many selling members of Holdings, as well as current Board members.
• The acquisition of BluJay in September 2021 also resulted in related party relationships, with certain BluJay Sellers having the option for Board representation.
• The Tax Receivable Agreement (TRA) involves certain members of Holdings (including affiliates of Insight Partners and Elliott Investment Management L.P.) who retained Holdings Common Units after E2open's public listing, entitling them to payments based on tax savings.
• The TRA Amendment, dated May 25, 2025, establishes an aggregate cash payment of $52,500,000 to TRA parties in full satisfaction of E2open's payment obligations, representing a reduction of approximately $52.5 million from prior contractual obligations.
• Tim Maudlin, a director, is a party to the TRA and is entitled to receive $9,011.42 from the TRA Amendment.
• Ryan Hinkle, a director and Managing Director of Insight Partners, is affiliated with Insight Partners, a TRA beneficiary entitled to receive $26,853,932 from the TRA Amendment.
• E2open agreed to indemnify the Signatory Members of the TRA Amendment, including Tim Maudlin and Insight Partners, for losses in connection with its approval of the TRA Amendment.
• The Investor Rights Agreement provides affiliates of Insight Partners, CC Capital, Francisco Partners, and Temasek the right to nominate Board members and includes registration rights and lock-up restrictions.
• An indemnification agreement was entered into with CC Capital Partners, LLC (Mr. Chu's investment firm) for financial and structural analysis services.
• The Sponsor Side Letter Agreement converted certain Class B ordinary shares held by the Sponsor and CCNB1's Independent Directors into Class B-1 Common Stock, with vesting conditions mirroring Series 2 RCUs.

Stakeholder Impact

• **Shareholders**: Will receive $3.30 per share in cash, representing a significant premium and immediate liquidity, but will lose future participation in E2open's growth as it becomes a private entity. Those who do not consent to the merger may exercise appraisal rights.
• **Employees**: Continuing employees will maintain no less favorable base salary/wage rate and annual target incentive opportunities for 12 months post-merger. Long-term equity opportunities will be comparable to Parent's. Equity awards will be cashed out or converted to Parent RSUs/cash awards. There is a potential cash-based transaction bonus program of up to $8,975,000.
• **Management/Directors**: Executive officers and non-employee directors will receive cash payouts for their equity awards. Executive officers are eligible for severance benefits upon a qualifying termination. Directors and officers will receive ongoing indemnification and D&O insurance coverage for six years post-merger.
• **Customers/Suppliers/Business Partners**: The announcement and pendency of the transaction could disrupt relationships, though the company aims to preserve significant commercial relationships. The merger combines E2open's SCM platform with WiseTech's logistics execution software, potentially offering integrated solutions.
• **Creditors**: Existing indebtedness under E2open's credit agreement will be repaid at closing, and Parent has committed sufficient funds for this purpose, ensuring creditors are satisfied.

Next Steps

• The merger is expected to be completed in the second half of 2025, following the satisfaction or waiver of all closing conditions.
• E2open's Class A Common Stock will be delisted from the NYSE and deregistered under the Securities Exchange Act of 1934 after the Company Merger Effective Time.
• Holders of Company Common Stock (other than Principal Stockholders) have appraisal rights under Section 262 of the DGCL, which must be properly exercised within 20 days after the mailing of this information statement (July 14, 2025).
• Parent will cause the Surviving Corporation to pay holders of Equity Awards through its payroll system or payroll provider, and issue Parent restricted stock unit awards, as applicable, promptly after the Closing Date.
• E2open will cooperate with Parent to effectuate the Special Warrant Exercise promptly after the Closing, including preparing communications and coordinating with the Warrant Agent.

Key Dates

Recommendation

Keywords

E2open, WiseTech Global, Merger, Acquisition, Supply Chain Management Software, Cloud-based Software, SaaS, SEC Filing, DEFM14C, Cash Transaction, Stockholder Consent, Tax Receivable Agreement, Corporate Governance, Risk Management, Financial Reporting