Behind the Koerber Group/HighJump acquisition

With its second U.S. acquisition in six months, European technology leader, Koerber Group pushes further into the North American market.

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Late last June, Koerber Group announced its fostered entry into the U.S. market with the acquisition of DM Logic, a provider of WMS and logistics software and integration services. At the time, Stephan Seifert, CEO of the Group Executive Board of Koerber AG noted that “With DMLogic, we gain another experienced partner to advance our long-term internationalization and growth course.”

When we interviewed Bob Kennedy, DM Logic’s vice president of business development, about the deal last July, he hinted that this was probably not the last acquisition, but without naming names. So, it wasn’t a complete surprise when Koerber announced the acquisition of HighJump software last August. So, what’s behind Koerber’s latest acquisition? And, who the heck is the Koerber Group? Those are the two questions I put to Stephan Seifert earlier this month.

To the second question, while it may not be a household name to U.S. readers, the Koerber Group is a holding company headquartered in Hamburg, Germany with some 11,200 employees world-wide, more than $2.5 billion in sales (2016) and more than 130 production, service and sales entities, according to the company’s website. The Group expects an estimated 15% increase in sales for 2017. Founded 70 years ago, Koerber now has six Business Areas (BA’s) specializing in automation, logistics systems, machine tools, pharma systems, tissue, tobacco and corporate ventures. “We always offer market leading solutions in an industry,” Seifert says. “We started in tobacco, and we’re the undisputed leader in that industry. And, we’re the undisputed leader in tissue and in tooling, especially surface grinding. We have a long-term strategic vision, and we build new businesses where we believe we can bring something to the table.”

When it does enter an industry, Seifert added, Koerber aims to become one of the top three providers in the world and to do so through a buy and build strategy – developing internally where that makes sense, and acquiring technologies where that makes sense. Last, the company is always working with a long-term focus. “We might even allow ourselves to take five to eight years to build our target position,” he says.

That strategy goes a long way towards explaining the DM Logic and HighJump acquisitions and the company’s plan for the North American market. The Business Area Koerber Logistics has three units for systems integration, product solutions, including automatic palletizing and robotics, and software. In years past, Koerber had collaborated with global suppliers on materials handling solutions when needed in its Business Areas. As all Körber BA’s increasingly need smart logistics solutions, the Group strategically decided to start building its own business with a different approach to the market.

In 2014, Koerber acquired Inconso, the leading WMS provider in Europe. That acquisition led to an eye on the North American market. “Our European customers often asked us to quote on projects in the U.S.,” Seifert says. “And, while Europe has the highest degree of automation in the world, the single largest market for logistics solutions is the U.S.” If Koerber was going to establish a presence here, it would need a systems integration partner, and it had experience working with DM Logic. “We believe they give us the presence we need in systems integration for our WMS and a platform for growth,” Seifert says. The HighJump acquisition, on the other hand, expands the portfolio offering and the breadth of customers Koerber can reach. “Inconso is a Tier One solution, like Manhattan and JDA,” Seifert says.

HighJump, on the other hand, has always had a strong foothold in the 3PL industry as well as small-to-mid-size customers. “The combination allows us serve about ¾’s of the global WMS market in terms of territory and the full range of warehouses,” Seifert says. He adds that Koerber plans to provide an entrée to the European market for HighJump. And, when it comes to production automation, Koerber also owns Werum, a world leading MES widely used in the pharmaceutical industry.

Looking forward, Seifert anticipates more acquisitions, maybe also including robotics. “We’re looking at what we have and what we need,” Seifert says. While Seifert also declines to name names, he adds, “I can confirm that technology is an area of key interest, and that there are some very interesting startups in the U.S. and Europe that have the possibility of going global.”


About the Author

Bob Trebilcock
Bob Trebilcock, editorial director, has covered materials handling, technology, logistics and supply chain topics for nearly 30 years. In addition to Supply Chain Management Review, he is also Executive Editor of Modern Materials Handling. A graduate of Bowling Green State University, Trebilcock lives in Keene, NH. He can be reached at 603-357-0484.

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