Global third-party logistics (3PL) services provider DSV Panalpina A/S (DSV) announced today it has inked an agreement to acquire Agility’s Global Integrated Logistics (GIL) business, the company’s standalone global logistics unit.
DSV officials said that this acquisition is expected to establish a top three global freight forwarder, for revenue, and will be an all-share transaction expected to close in the third quarter. And it also noted that Agility will become DSV’s second largest shareholder, with an 8% ownership stake in the company. What’s more, DSV added that the combination of DSV and GIL will boost DSV’s standing as a leading global freight transportation and logistics provider with a combined pro forma revenue of around $22 billion (USD) and a cumulative workforce comprised of more than 70,000 employees. And it also said that with Agility GIL in the fold, it will have operations in more than 90 countries and expected volumes of more than 2.8 million containers (TEU) and also more than 1.6 million tons of air freight transported on an annual basis.
“This deal creates significant shareholder value and marks a new milestone in Agility’s journey. Agility remains committed to the supply chain industry, and will become the second largest shareholder in one of the fastest-growing and most profitable logistics companies in the world,” said Tarek Sultan, Agility’s Vice-Chairman, in a statement. “I want to thank GIL’s leadership and employees for profitably growing the company and steering it through one of the most challenging periods the industry has ever seen during the global pandemic. Agility is proud of what GIL has achieved. Agility will be exploring opportunities between DSV and its other businesses, with promising areas of future cooperation potentially including Agility’s Logistics Parks business, Shipa group of companies, and technology ventures. Agility will remain an emerging markets leader, investor in emerging technologies, and champion of sustainable business.”
And Jens Bjørn Andersen, Group CEO of DSV, called this deal an excellent match, saying it will enable DSV to provide its customers with even higher service levels, stating that the GIL global network, industry competencies and APAC and Middle East market position are well-matched for the DSV network while also augmenting its long-term value creation goals.
DSV also pointed to various synergies this deal brings, including:
“DSV/Panalpina has made another large acquisition. GIL's revenue's exceed $4 billion a year and will add about 20% to the combined companies total,” said Dick Armstrong, Chairman of Milwaukee-based supply chain consultancy Armstrong & Associates. “Importantly, GIL's strongest markets globally will flesh out areas already covered by DSV. The combination will create the third largest transportation/logistics company in the world. GIL's strengths in the Mid-East will allow for the expansion of the Europe/MidEast road business. This is a strong challenge to major competitors. What's next?”
And Ben Gordon, Managing Partner of Cambridge Capital, an investor in niche supply chain leaders, and also Managing Partner of BGSA Holdings, a leading mergers and acquisitions advisory firm focused on the transportation, logistics, and supply chain technology sectors, noted that DSV Panalpina was the natural buyer for Agility Global Integrated Logistics.
“They have a complimentary network, adjacent capabilities, and an ability to generate significant synergies,” said Gordon. “I expect we will continue to see more strategic acquisitions in the global logistics world this year.”