CEO insists future success of Danish logistics group is not dependent on this one acquisition.
DSV will remain on the lookout for major acquisition opportunities regardless of the fate of its $4 billion bid for Panalpina, according to CEO Jens Bjorn Andersen.
Panalpina’s board and major shareholders are currently considering last week’s offer from its Copenhagen-headquartered competitor DSV to acquire the company at a price of CHF 170 per share, comprising a mix of cash and DSV shares.
Quoted by Reuters while on a visit to Zurich earlier this week for meetings, Andersen said: “For sure, we will continue to do that (pursue major acquisition opportunities). It is the best way we can spend the money we generate ourselves.”
Andersen revealed that part of the attraction of Panalpina was that it would allow DSV to expand its footprint in air and ocean freight forwarding, an area of the (DSV) business that has seen a very strong growth path in recent years. He declined to comment on whether DSV was prepared to increase its offer if required, insisting only that the group would remain disciplined in its approach.
“We are not afraid of failing twice,” he said, in a reference, presumably, to DSV’s failed bid late last year for CEVA Logistics. “The future success of DSV is not dependent on this acquisition.”
Purchasing Panalpina would be by far the Danish group’s biggest acquisition to date, its previous biggest acquisition being the $1.35 billion purchase of US group UTi Worldwide in January 2016. In October last year, DSV’s $1.55 billion offer for CEVA Logistics was rejected, with CEVA instead choosing to consolidate its existing partnership with container line CMA CGM.
If DSV’s bid for Panalpina is successful it will create the world’s fourth-ranking freight forwarding entity behind DHL Global Forwarding, Kuehne + Nagel and DB Schenker.
Meanwhile, Kuehne + Nagel has declined to comment on a Swiss media report in which its majority shareholder, Klaus-Michael Kühne, said the group had no intention of seeking what he described as a “mega merger” with Panalpina.
Quoted by the Handelszeitung newspaper, he said of DSV’s bid for Panalpina: “If the Danes want to acquire a business that is hopelessly overvalued, like Panalpina, one can’t prevent them,” seemingly bringing to an end rumours that Kuehne + Nagel was planning a counter bid for its fellow Switzerland-based counterpart.
Kühne added that Panalpina might have been a more financially attractive target a year ago whereas now there was a mismatch between the company’s operative potential and its valuation.
Source: Lloyd’s
