PwC Reports More Logistics M&A Activity

Merger and acquisition activity in the transportation and logistics sectors in the second quarter was up slightly on an annual basis

By ·

Merger and acquisition (M&A) activity in the transportation and logistics sectors in the second quarter was up slightly on an annual basis, according to data released this week by Pricewaterhouse Coopers.

Deals cited by PwC represent all announced deals for the quarter-as opposed to completed deals only-and the report does not parse out deals that are withdrawn, intended, or pending.

Second quarter deal value—for deals valued at $50 million or more—was $15.2 billion and represents 31 announced deals compared to the second quarter of 2012, which had 51 deals totaling $14.3 billion. And the average deal size for the quarter at $490 million topped last year’s $281 million. PwC attributed the annual gain to three “infrastructure mega deals” worth more than $1 billion.

In the report, PwC noted that infrastructure-related deals should lead the way for M&A transactions in the transportation and logistics sector, especially in South America and Europe.

“What we are seeing is not a bad environment for deal making but not a great environment for it either,” said Jonathan Kletzel, U.S. transportation and logistics advisory leader for PwC, in an interview. “There are some signs of improvement from a global economy and geopolitical perspective over the last decade but things are largely flat.”

The report observed that in the second quarter strategic investors accounted for 61 percent of deals, while financial investors are showing an increased appetite for shipping and port-related deals that could likely be due to prolonged overcapacity in the ocean shipping sector.

Kletzel said there is a feeling among investors that as various modes have recovered, ocean shipping could be next, leading to more opportunities for better margins in that sector.

Deal making activity in the United States and Europe is somewhat tempered compared to other parts of the world, according to PwC. The firm explained that the slower pace of deal making activity in these region is due in large part—especially in Europe—to companies largely remaining idle, or on the sidelines. What’s more, it pointed out that the respective economic challenges in each region are impacting activity, too, but that the near-term outlook for the U.S. is likely brighter due to the emergence of shale gas-related activity and the recent upswing in manufacturing activity, too.


About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at pburnson@peerlessmedia.com.

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Article Topics

All Topics
Latest Whitepaper
Making E-Commerce Logistics Work
Special Digital Issue: Eight feature stories that neatly encapsulate the new technology and processes that are revolutionizing logistics and supply chain operations.
Download Today!
From the February 2017 Issue
As the new administration sends waves of uncertainly through the global trade community, this could be the best time ever for shippers to build an investment case for GTM. Here are five trends you need to watch if you’re about to put these savvy systems to work
Carrier Consolidation Keeps Shippers Guessing
Getting Value from the Cloud
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Advance your career with the fastest growing logistics certification – APICS CLTD
During this webcast presenters will give an overview of APICS and the new Certified in Logistics, Transportation and Distribution (CLTD) designation. Learn how the CLTD program can help you stay on top of current trends and advance your career.
Register Today!
EDITORS' PICKS
ASEAN Logistics: Building Collectively
While most of the world withdraws inward, Southeast Asia is practicing effective cooperation between...
2017 Rate Outlook: Will the pieces fall into place?
Trade and transport analysts see a turnaround in last year’s negative market outlook, but as...

Logistics Management’s Top Logistics News Stories 2016
From mergers and acquisitions to regulation changes, Logistics Management has compiled the most...
Making the TMS Decision: Ariens Finds Just the Right Fit
The third time is the charm for this U.S. manufacturer on the hunt for a third-party logistics (3PL)...