Deutsche Post DHL today moved a step closer to selling DHL’s loss-making French domestic parcelbusiness to financial investor Caravelle by gaining official approval from German authorities.
The German cartel office stated in its list of pending applications that it today approved theacquisition by Caravelle of parts of DHL Express and DHL Freight in France. The transaction wasofficially registered with the anti-trust authority on May 3.
The Financial Times Deutschland had earlier cited a Deutsche Post spokesman as saying that thedeal was close to completion. CFO Larry Rosen said in the Q1 analysts conference call yesterdaythat the transaction was planned for the second quarter of the year.
Deutsche Post DHL announced last November that it had received an offer from the Frenchfinancial investor for the domestic parcels business and stated that it wanted to complete the dealby the end of Q1, 2010. This deadline was put back into Q2, 2010, as negotiations continued longerthan expected.
DHL Express France’s ‘messagerie’ (parcel and freight) business, with some 3,500 employees, 68depots and annual revenues of some €300 million, has made repeated losses in recent years and wasexpected to make a loss of about €70 million in 2009. It was already separated from DHLInternational Express France in 2008.
According to French media reports, Caravelle plans to re-brand the business as Ducros Express,the name of one of several French parcel companies acquired by Deutsche Post in the late 1990swhich were later merged as DHL Express France. The company would be downsized to a network of some55-60 depots and about 600-700 jobs are at risk, transport newspaper L’Officiel des transporteurswrote. However, Caravelle would also invest in modernisation of the sorting centres and IT systems,with the aim of establishing the company as the second-largest parcel operator in France.
Deutsche Post DHL’s disposal of the French domestic business will follow similar moves in the UKand Ireland as well as the previous withdrawal from the US domestic express market as DHL Expressfocuses more on international business in the future.
