German-owned freight logistics group Schenker is reportedly poised to buy the leading USforwarder BAX Global in a deal worth up to one billion dollars. The acquisition would make
Schenker, the Deutsche Bahn (DB) logistics subsidiary, the world’s second-largest air cargoforwarder behind DHL Danzas Air & Ocean.The DB supervisory board was due to meet to decide on a takeover bid, the Financial TimesDeutschland reported today (Nov 7). An industry source was quoted as saying the deal was worth “atleast a three-digit million (euro) figure”. Other media put the figure at between 800 million eurosand one billion euros. DB declined to comment on the information.
DB is known to want to expand Schenker’s global presence in the air and ocean forwarding, andcontract logistics sectors both organically and through acquisitions if necessary. Schenker iscurrently number five in the air cargo sector while BAX Global is number six, each with a marketshare of just over three per cent. The two companies would be largely complementary given Schenker’s strong position in Europe and Asia, and the largely US-based business of BAX Global.
Schenker had overall revenues of 8,042 million euros from European land transportation, air andsea freight forwarding, and contract logistics in 2004. BAX Global had revenues of $2,440 millionin the year ending December 31, 2004. The forwarder has improved its overall profitability over thelast year thanks to the pick-up in world freight markets but its US profits remain much lower thanits overseas earnings. There have been reports recently that owner Brink’s, under pressure fromfinancial investors, might consider a sale for the right price.
The deal would mark another round in the ongoing consolidation of the worldwide logistics sectorfollowing Deutsche Post World Net’s bid for Exel.
