Lightspeed Acquires Vend For $350M; Street Sees 25% Upside

Lightspeed POS Inc announced the acquisition of cloud-based retail management software provider Vend for $350 million. The acquisition will help Lightspeed, a provider of omnichannel commerce platforms, strengthen its position in the Asia-pacific region. Shares were up about 7% at the close of trade on Friday.

Upon closure of the acquisition, Lightspeed (LSPD) will operate as a technology partner to more than 135,000 customer locations across the globe. The company intends to make use of Vend’s technology stack and user experience expertise to deliver highly advanced commerce solutions to retailers around the world.

The total consideration of $350 million consists of $192.5 million in cash and $157.5 million by issuance of subordinate voting shares of Lightspeed. The transaction is expected to close by the end of April, subject to regulatory approvals.

Lightspeed’s founder and CEO, Dax Dasilva, said, “Lightspeed’s mission is to ignite the potential of businesses to enrich the communities they serve, whether they are beloved local neighbourhoods or the thriving metropolitan cities we are eager to see bustling with crowds once again.”

Vend CEO Ana Wight said, “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 history.”  (See Lightspeed stock analysis on TipRanks)

On March 12, in response to the Vend acquisition, BTIG analyst Mark Palmer raised the stock’s price target to C$104 (20.7% upside potential) from C$97 and reiterated a Buy rating. Palmer sees the acquisition as “the next step in Lightspeed building out a global platform aimed at addressing the $100 trillion total addressable market opportunity to facilitate omnichannel business to consumer commerce for small and medium sized businesses.”

Furthermore, the analyst sees the recent weakness in Lightspeed shares as a buying opportunity.

Turning to the rest of the Street, the stock has a Strong Buy consensus rating alongside an average analyst price target of $86.29 (24.8% upside potential). That’s based on 12 Buys and 2 Holds. Shares have rallied a staggering 431.7% over the past year.

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