Top 50 3PLs: Will mergers and acquisitions alter the third party logistics landscape?

A flurry of major service provider deals captured mainstream headlines in recent months, but the consequence of this activity has yet to be measured by domestic and international shippers. Meanwhile, the EU flounders, Asia remains strong, and emerging nations may represent the next great opportunity for the major 3PL players.
By Patrick Burnson, Executive Editor
June 01, 2012 - LM Editorial

“Overall, logistics deal activity seems more likely to rise than fall given continued global economic expansion and the secular trend of rising infrastructure concessions,” says Evans.

For 3PLs, adds Evans, consolidation will be an ongoing given, as more pure-play domestic companies seek to expand globally. “I can assure you that even the 3PLs found only on ‘domestic’ listings will at some point be hauling or arranging to haul freight globally,” he says. “For those bigger companies seeking to expand worldwide, mergers and acquisitions can be an attractive way to proceed.”

If one needed any more evidence of this phenomenon, consider the merger and acquisition activity of just a few months ago. UPS not only made a celebrated purchase of TNT Express, but went on to buy Italian pharmaceutical logistics company Pieffe. Geodis, meanwhile, acquired French pharmaceutical logistics and distribution company Pharmalog.

Then in a move to broaden its own pharmaceuticals footprint, DHL Global Forwarding acquired Lufthansa’s 50 percent ownership in its joint venture company LifeConEx, a cold chain management provider in the life sciences industry.

In the Asia Pacific region, merger and acquisition activity was just as intense. Kerry Logistics acquired Trustspeed Medicine Logistics in Taiwan, and it also established a joint venture with Mosskito Logistics in Australia to expand its cold chain distribution segment.

Meanwhile, data from Armstrong & Associates—the third party logistics consultancy that compiles our annual top rankings of global and domestic 3PLs—shows that all of this global merger and acquisition activity certainly makes sound, business sense. In fact, Armstrong reports that total global 3PL gross revenue in 2011 at $133.8 billion was up 5.2 percent over 2010. Furthermore, net revenues, at an estimated $61 billion, posted a 5.9 percent annual gain.

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 .(JavaScript must be enabled to view this email address).

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!

Recent Entries

Logistics Management recently spoke with Abtin Hamidi, chief vice president and co-founder of Mountain View, Calif.-based CargoChief, a provider of transportation and logistics technology focused on providing shippers with securing over-the-road capacity and pricing, among other services.

Christopher L. Koch, who just retired from a 15-year tenure as president and CEO of the World Shipping Council (WSC), and continues to serve as its senior advisor, is still telling shippers to stay the course.

Seasonally-adjusted (SA) for-hire truck tonnage in October at 135.7 (2000=100) was up 1.9 percent compared to September’s 133.1, and the ATA’s not seasonally-adjusted (NSA) index, which represents the change in tonnage actually hauled by fleets before any seasonal adjustment was 139.8 in October, which was 0.9 percent ahead of September.

The average price per gallon of diesel gasoline fell 3.7 cents to $2.445 per gallon, according to data issued today by the Department of Energy’s Energy Information Administration (EIA). This marks the lowest weekly price for diesel since June 1, 2009, when it was at $2.352 per gallon.

In its report, entitled “Grey is the new Black,” JLL takes a close look at supply chain-related trends that can influence retailers’ approaches to Black Friday.


Post a comment
Commenting is not available in this channel entry.

© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA