JPMorgan has agreed to buy trade information and software provider, Vastera and merge it with its treasury services unit. The acquisition will give the bank's trade customers access to logistics information surrounding imports and exports, including those clients who trade in Asia. Vastera has a reasonable Asian footprint with activities concentrated in China and Japan.
Vastera's services are used by 400 customers worldwide. Its information and database products allow traders to manage their global trade operations with information on the classification of goods, licence controls, shipment reconciliation, import and export tariffs and customs inspections.
JPMorgan awaits regulatory approval of the acquisition, but has agreed to pay about $129 million to the company's shareholders to buy the business. Two major shareholders representing about 28% of Vastera shares have committed to vote their shares in favour of the transaction.
If the deal goes ahead, the business will be merged with JPMorgan's treasury services unit and be sold to multinational clients as a trade supply chain product.
Alexander Caviezel, who heads JPMorgan's treasury services business in Asia, says the acquisition will allow the bank's customers to further automate the processes associated with the physical movement of goods.
"JPMorgan already provides clients with information surrounding the financing of imports and exports; Vastera will increase visibility on the logistics side," says Caviezel. "The combination of the two will give our customers a better understanding of the cash flows associated with the delivery or receipt of goods. It will help them to save money while also improving compliance with government regulations."
Caviezel says the Vastera product set fits with JPMorgan's focus on multinational clients. "The software and databases are suited to those companies with a global reach and a broad distribution network."
For now, most of Vastera's activities in Asia are concentrated in Japan and China but JPMorgan plans to expand this.
Vastera is headquartered in Dulles, Virginia and employs 650 people globally.