📊 2024 Transportation and logistics M&A outlook

Irbis Index January 2024

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News

The shifting sands of M&A in transportation and logistics The transportation and logistics sector is witnessing a significant transformation in its M&A landscape as it enters 2024, as highlighted in the latest McKinsey report.

Travel, logistics, and infrastructure fact sheet

Key Insights:

• Pandemic influence: The pandemic accelerated M&A activity in the sector as companies sought to enhance their supply chain capabilities.

• 2024 Outlook: Although deal activity slowed in 2023, 2024 is anticipated to offer fresh opportunities for M&A in transportation and logistics. Investors have prepared funds for deployment, signaling a readiness to capitalize on emerging prospects.

• M&A landscape is evolving, influenced by financial, market, and technological forces.

• Investment priorities: The changing landscape suggests five main priorities for M&A investment in the sector:

• The transportation and logistics industry is at a pivotal point, with powerful forces reshaping its future. As the industry navigates through these changes, M&A strategies will play a crucial role in enabling companies to adapt and thrive in the new environment. (link)

Bidding war for Wincanton drives up UK logistics group shares Wincanton, a prominent UK haulage company, has endorsed a £762 million takeover offer from GXO, a US logistics firm.

• The Wincanton board has decided to recommend GXO's bid of 605 pence per share to its shareholders, retracting its previous support for a competing offer from CEVA Logistics, a Marseille-based company, which had proposed 480 pence per share.

• GXO's offer represents a 29% premium over Wincanton's share price before the initial bid from CEVA.

• Wincanton's acceptance of GXO's proposal comes amidst a wave of takeover bids for UK-listed companies, reflecting the perceived undervaluation of UK assets due to factors such as a weak pound, economic struggles, and Brexit's lingering effects.

• The acquisition by GXO is seen as a strategic move to enhance its position in the UK and Ireland markets, capitalizing on Wincanton's logistics expertise and customer relations. (link)

DHL opens new International Logistics Center in Poznan, Poland DHL Group has launched a new €180 million international logistics center in Robakowo, near Poznan, Poland.

• This facility, one of Europe's largest and most advanced for parcel sorting and logistics, spans 32,000 square meters and features a sorting capacity of 45,000 parcels per hour.

• It is expected to handle up to 1 million parcels daily during peak times. The center is a joint project between DHL eCommerce, Post + Parcel Germany, and DHL Freight, and includes a DHL Freight terminal for processing palletized shipments.

• The Poznan hub will have direct linehaul connections to parcel hubs in Germany, Poland, and other European countries, enhancing service quality and reducing transit times, particularly between Germany and Poland.

• The center aligns with DHL's sustainability strategy, utilizing a photovoltaic system for a third of its energy needs and incorporating environmentally friendly transportation solutions. (link)

Ocean Alliance extended for 5 additional years The Ocean Alliance, comprising CMA CGM, COSCO, OOCL, and Evergreen, has announced a five-year extension of their operational agreement, now set to expire in 2032.

• This extension underscores the alliance's commitment to stability and cooperation amidst a dynamic industry landscape.

• The Ocean Alliance, which was established in 2017, has become a significant player in global shipping, offering extensive services across major East and West trade routes.

• This move comes at a time when the shipping industry is experiencing shifts, with the upcoming Maersk-MSC split and the formation of the Maersk-Hapag-Lloyd Gemini Cooperation.

• The extension positions the Ocean Alliance to continue providing competitive and reliable services, particularly in connecting Asia with Northern Europe, the Mediterranean, the Middle East, and North America's coasts. (link)

Kuehne+Nagel to acquire City Zone Express Kuehne+Nagel has announced the acquisition of City Zone Express, a move that will significantly enhance its cross-border road logistics services in Southeast Asia and China.

• This strategic acquisition, valued at $50M, will integrate City Zone Express's extensive network, which includes over 500 employees, an own fleet of 260 vehicles, and 80,000 sqm of warehousing space, with Kuehne+Nagel's global logistics expertise and eTrucknow visibility platform.

• The merger aims to better serve the booming e-commerce and high-tech industries in the region, leveraging City Zone Express's established presence in Malaysia, Singapore, Vietnam, Thailand, and China. (link)

Other headlines 

Shadowfax, a leading Indian logistics provider, has raised $100 million in Series E funding, to fuel its rapid growth in instant delivery services.

U.S. Commerce Secretary Gina Raimondo expressed confidence in the United States’ ability to house the entire supply chain for silicon and advanced chips.

Egypt commits $41B for green hydrogen and renewable energy projects over the next decade, aiming to become a key player in sustainable energy.

Walden Group has officially entered the Italian market with the acquisition of XCM Healthcare, a healthcare logistics company, and Unitex, a healthcare temperature-controlled last-mile network.

Investors are withdrawing from the electric vehicle sector as stock values plummet, reflecting growing concerns over the industry's profitability and future growth prospects.

War-risk insurance premiums for shipping in the Red Sea have surged by up to 900% due to ongoing attacks by Houthi rebels, significantly impacting the cost of shipping in the region.