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Is a Swiss forwarding merger on the cards?

Peter Ulber’s announcement last week that he will step down as Chairman of Panalpina next May has fired rumours that the company is a takeover target for Kuehne & Nagel. Meanwhile, CEVA Logistics has acquired CMA CGM Log as part of a new strategic partnership with CMA CGM. Nicolas Sartini will switch from APL to become COO and Deputy CEO of CEVA Logistics

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In October, Reuters, citing Swiss magazine Bilanz, reported that Swedish investor group Cevian Capital, the second biggest shareholder in the Swiss-based air and seafreight forwarder, with a 12.3% stake, had run out of patience with Peter Ulber, who has been Chairman since 2016, and wanted a change. He added that Panalpine consider merging in order to raise the share price.


Panalpina rejected the attack and said that it had a "robust strategy," adding that it would "participate in consolidation of the fragmented sector" by seeking its own acquisitions.


The Ernst Göhner Foundation is Panalpina’s largest investor with a stake of 46%. As both Ulber and Panalpina’s Vice-Chairman Beat Walti are also on the Foundation’s Board, it is argued that more independent executives are needed.


It is understood, however, that the Foundation would not necessarily reject a takeover bid and Detlef Trefzger, CEO of Kuehne & Nagel, told the Swiss newspaper Finanz& Wirtschaft that "we are always ready to talk…we won’t do hostile takeovers."


Trefzger added that Kuehne & Nagel is actively pursuing deals within the fragmented logistics industry to bring new technology, access to markets and customer segments, synergies and additional volume.


Panalpina has annual revenues of US$5B compared with Kuehne & Nagel’s US$18.6B. The difficulty for Kuehne & Nagel would not be the asking price, but getting a deal accepted by the competition authorities.


It is also rumoured in the market that DSV has an eye on Panalpina, following its unsuccessful attempt to take over CEVA Logistics. The latter company has just acquired CMA CGM Log, the freight management arm of CMA CGM, for US$105M in debt-free cash and will work closely with the carrier to extend its ocean freight business.

Nicolas Sartini
Nicolas Sartini

The deal is subject to regulatory approvals, but this is not expected to be a problem given the fractionalism in the forwarding world. Nevertheless, CEVA and CMA CGM both stated that they will retain their "arm’s length" business relationship. The demands from shippers for the transportation sector writ large to "catch up" with Industry 4.0 are also driving cooperation and mergers, since scale and commonality are required to optimise digitisation.


In a statement, CEVA said it "expects to leverage CMA CGM’s overall platform to realize efficiency improvements. Back-office function synergies have been already identified, including savings on current outsourcing contracts, transfer of functions to a shared service centre and more efficient billing and cash collection. On the procurement side, savings on services and consumables are also expected to contribute to savings."


As part of the integration process, Nicolas Sartini will switch from CMA CGM affiliate APL to become COO and Deputy CEO of CEVA Logistics with effect from 1st January 2019.

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