Smithfield, Rhode Island, U.S.A.-based CAI Software acquired Molde, Norway-based Maritech on 28 February, creating one of the seafood industry’s leading enterprise resource planning (ERP) software providers.
In a joint interview with SeafoodSource, CAI Software CEO Brian Rigney and Maritech CEO Odd Arne Kristengård discussed the acquisition and the combined entity’s future plans.
SeafoodSource: What is the backstory to this acquisition?
Rigney: It's been a long time coming. It started off with a cold call at Seafood Expo North America two years ago when I introduced myself to a couple of Maritech folks on the show floor. This, in turn, led to a series of off-and-on discussions over the last two years. It went from the acquisition not making sense to figuring out how it made sense and then determining if we had a shared vision for the future. And then, of course, the financial details come into the picture eventually. That last part took around six months.
SeafoodSource: Both companies have grown a lot through acquisitions in recent years. How did each company’s growth plan result in this move?
Rigney: When I joined the company five years ago, the goal was to grow by way of acquisition and organic growth. Since then, we've been focused on building a supply chain software company that is really end to end in two verticals: manufacturing and food and beverage.
You might suspect that those two are very different, but in fact, they're very much the same. All of our systems are mission-critical; our customers cannot ship product without them. They're very production-oriented, meaning Seasoft, as an ERP system, has a presence on the production floor – where fish is being cut and where lobsters are being packed.
Similarly, our manufacturing software is also very production-oriented. As we began to grow, we made a series of acquisitions on the manufacturing side, but I've been really looking to make this acquisition on the food side because it accelerates our ability to invest in the product, accelerates our growth into other markets, and it allows us to extend to more customers in North America who we might not otherwise have been able to meet.
Kristengård: Maritech has been, for the last few years, focusing a lot to build out its seafood supply chain platform, going from customization for Norwegian customers to more standardized cloud-based solutions, covering the whole seafood supply chain.
We have out-of-the-box, best-practice solutions for the seafood industry, and that can be attractive instead of spending thousands of hours to convert your generic ERP into seafood.
We have wanted to become a global company. This is perfect timing in showing how far we have come now on the platform and on the international stage. Given the resources that CAI can provide us taking the next step in our journey, especially expanding into North America, it’s happy days now at Maritech.
SeafoodSource: Can you provide more detail around how the two companies will be combined? Will CAI’s Seasoft technology and Maritech’s tech be combined in any way?
Rigney: From a product perspective, the two products – Seasoft and Maritech – will remain separate. Seasoft has its place with middle-market and lower-middle market seafood producers, distributors, and suppliers – generally those who both process and do recipe-based production as well but also really need a general ledger system.
Maritech doesn't have a general ledger system, so [we can target their products to] middle-market larger companies – maybe in a different part of the supply chain – that already have a financial general ledger system in place but need large production capacity traceability, warehousing software, and other things that Maritech has.
A lot of our prospective customers may have recently moved to some other financial ERP system, but those systems are good at finance yet have nothing that works on the production floor; that's where Maritech comes in. So, [the two companies can come] together nicely to meet the needs of the market.
SeafoodSource: What role will the seafood industry play in the combined company’s future?
Rigney: The seafood industry is critical to our coordinated overall vision. What's interesting is that some of Maritech’s customers are our customers’ vendors, meaning Maritech has a number of customers in Norway and elsewhere that serve as vendors to people who use Seasoft today. So, when you're talking about building out a full supply chain system, this is part of that vision.
Kristengård: We have customers in Norway who are exporting to North America. Now, together with CAI, it gives us the opportunity to really focus on giving those customers an even better experience with our solutions going forward.
SeafoodSource: What is the importance of technology to the seafood industry, and how does CAI plan to shape that discussion moving forward?
Rigney: On a broader basis, CAI has been investing aggressively recently in product development, and on the manufacturing side, we’re helping accelerate the digital transformation of many manufacturers.
What the partnership with Maritech does is allow us to accelerate that path on the food side, where we're really excited with what they've built over the last several years.
We help manufacturers provide digital work instructions with quality assurance certifications at every step of the process for some of the world's largest manufacturers. We see that beginning to flip over to the food and beverage side. We also see that traceability, which is used across both verticals, is becoming mission-critical for the food industry, and that's where we see a lot of advancement.
Kristengård: Maritech has chosen to have a very holistic view of the seafood value chain. Regarding traceability, building solutions in the cloud to follow the seafood all the way through to the end market is crucial. I think that business processes in seafood are the same all over the world, basically. So, our contribution to that digital transformation is now coming into the seafood industry.
SeafoodSource: What specific technologies does the seafood industry need to adopt in order to meet its growth goals, and how can the products and services you offer help it to get where it wants to go?
Rigney: The continued digitization of the supply chain needs to happen fully over the next three to 15 years. There are people who are still using paper for their order entry, and we have folks who are using Google Sheets to manage some of their ordering; so, this is fairly fundamental to how they need to transform. There’s certainly greater consumer awareness of the supply chain. Companies now need to give consumers the confidence that the fish they're buying is properly sourced, labeled, and fresh.
This partnership between CAI and Maritech becomes a way to achieve that on a global basis. With this acquisition, we can help them accelerate delivering their solutions to the North American market. They have a super strong presence in Norway – one of the leading fish producers in the world – but now, the task is to increase their presence in the rest of the world.
Kristengård: We know the market will demand more documented sustainable food. Through digitalization, we can help the producers supply that. Also, with that digitalization, they will become more efficient in their processes. So, in turn, that should affect the prices and distribution in a good way. We have a big role here to play for the seafood industry to grow.
SeafoodSource: It’s fairly unusual to see an American company move into Norway with an acquisition. What is your plan for overcoming the natural hurdles that exist between the two markets?
Rigney: Maritech’s culture and its technology is awesome, and the cultures at the two companies are very similar. Both teams like to innovate. Both teams are focused on the needs of customers. There are far more similarities than differences, and I have had actually no worries at all about cultural differences within the team.
SeafoodSource: Maritech has also invested in its data capacity, especially via the development of Maritech Eye and the acquisition of the Sea Data Center. What will be the future of that initiative?
Kristengård: I think that having a data strategy is something that we, as a serious software solutions vendor, need to have in order to be relevant in the years to come. We have from our tech side, a data platform built combining internal data, third-party data, and Sea Data Center data, and we can create custom reporting. Not only that, it's also about also bringing AI into our applications using all that data.
Rigney: I’m thrilled with the data. I love the concept of Maritech Eye and other data input and gathering systems. This is a key part of the long-term plan for building out a full supply chain software company. This spans everything from Maritech Eye, where we’re capturing scanning data on fish, to a full supply chain insights suite where their customers are our customers’ vendors. We can really build out a platform that provides enormous value to all players in the market.
SeafoodSource: Can you expound more upon what your short-term and long-term vision is for the company? Also, how is your connection with private equity firm Symphony Technology Group (STG) Partners aiding you in achieving that vision?
Rigney: Short term, we're going to have a team who will travel to Norway in four to six weeks and dive into the product, making sure what we can deliver to the North American market is spot on. We'll also be exhibiting jointly at the 2024 Seafood Expo North America.
Long term, the vision we've laid out will carry us through the next 10-plus years, turning ourselves into an end-to-end supply chain software platform for food and manufacturing. Within that space, we have made multiple acquisitions, and we’ll continue to make further acquisitions over the next several years. Private equity has, in our case, been a boon to help us grow, to help us recruit talent, and to help us bring new technologies to market.
Ultimately, this is a story of two small companies that have grown over the last several years coming together, and together, we're still relatively small; we're only 300 employees. But, we're in a really good spot to continue our growth and drive value to our customers. One of the things I've come to really appreciate with our team is that everyone is incredibly customer-focused. Seafood is a small industry, and word of mouth is paramount. Good products, good companies, and good people will thrive in that environment, and our effort is focused on being a successful part of that value creation.
