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Global transport and logistics company DSV has joined the industry’s move towards consolidation, preparing to acquire ABX Logistics.
DSV announced it has entered into an agreement with 3i Group, ABX’s management team, and other shareholders to acquire all of the shares of XB Luxembourg, the parent of ABX Logistics Group.
The aggregate price of the entire share capital, on a debt and cash free basis, is EUR 750 million, with the acquisition financed through bridge financing facilitated by the current main banks of the DSV Group.
The amalgamation of the two European transport and logistics companies is expected to create a strong international player, with their pro-forma combined annual revenues reaching EUR 6.5 billion last year. They together employ approximately 25,000 employees, operating transport networks in more than 60 countries.
DSV chief executive officer Kurt K. Larsen said: “For a number of years, ABX has been at the top of the list of potential combination candidates.
“The match between the two organisations is almost ideal, both geographically and in respect of activities.”
The acquisition would enable doubling the size of their air and sea businesses as well as complementing each other’s geographic presence in the northern Europe (DSV) and south-western Europe markets (ABX).
The two companies will integrate their activities in air, sea, road and contract logistics, with the full implementation expected to complete by 2011.
Robert Van Goethem from 3i Partner said the deal would be an example of achieving synergy amidst the increasing interest in consolidation in the freight forwarding market.
“The merger of ABX and DSV will significantly strengthen the growth potential of ABX’s acitivies as it will be able to benefit from a much larger network effect.”
The transaction is expected to complete in the third quarter of 2008 and is subject to approval by the relevant competition authorities.
Photo Courtesy of DSV
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