Two industry competitors have joined forces to become the largest freight audit and payment solutions provider.
By Michelle Corbet, Reporter
Jun 28, 2018, 2:19pm CDT
Memphis Business Journal
Friday, June 22, Memphis-based Veraction, a transportation spend management and freight audit solutions provider, completed a merger with Trax Technologies, a global freight audit and payment provider, headquartered in Scottsdale, Arizona.
“Memphis now hosts the largest private transportation spend management company on the planet, and our goal is to get much bigger,” said Chris Connell, the former CEO of Veraction who will also lead the new combined company as CEO of Trax Group Inc.
Financial details of the transaction were not disclosed, but Veraction will take the Trax name and the leadership and employees from both companies will be combined.
Both companies are owned by private equity firms who will maintain 50/50 governance. Veraction is owned by New York-based Spire Capital Partners. Trax is owned by Austin, Texas-based Strattam Capital.
Connell said the freight audit and payment industry has been in need of a shake-up and the change will set the bar higher for peer companies, including local businesses such as CTSI-Global and Green Mountain Technology.
The company has a long history in Memphis. It was originally founded as Accuship in 1994. As it passed among private equity companies, its name changed to Iron Data Transportation and, most recently, Veraction.
“There’s not a lot of investment in the industry, but we’ve spent millions over the last couple of years in technology to modernize the business and we were looking to leverage that,” Connell said.
Veraction has been working to advance freight audit and bill payment services into holistic transportation spend management solutions.
“Companies want to manage, control and gain visibility over transportation spend. It is complex and dynamic,” Connell said. “We can not only audit freight but also provide rich analytics that tell [customers] why it is changing from week to week, so they can make a better decision next week.”
The merger will give Veraction additional resources to undertake more research and development and product development.
In January, Veraction acquired Los Angeles-based National Traffic Consultants, which provides freight pre-audit, payment and data management solutions to some of the world’s largest companies including Epson, Toshiba and Mazda.
Now joining with Trax, the combined company is the largest private company in its industry, managing more than $10 billion in logistics spending across all transportation modes for more than 300 enterprise customers.
“There’s never been a clearly defined leader in this space. Now there’s no doubt about it: we’re the biggest,” Connell said.