DSV Moves to Acquire Schenker AG: A Strategic Shift in Logistics

Transformative Acquisition by DSV A/S

Company Announcement

DSV A/S has signed a pivotal agreement to acquire 100% of Schenker AG in an all-cash transaction valued at EUR 14.3 billion, approximately DKK 107 billion. This landmark deal marks a significant move for DSV, setting the stage for it to emerge as a leader in the global transport and logistics sector.

The Merger of Titans

This acquisition will merge the strengths of DSV and Schenker, creating a powerhouse with projected revenues of DKK 293 billion based on the financials from 2023. The combined entity will boast around 147,000 employees and operations in over 90 countries, offering extensive logistical solutions and a robust global network.

Strengths and Synergies

The integration of Schenker into DSV's operations is expected to yield significant economies of scale. This will not only bolster DSV’s current capabilities but also enrich the service offerings available to clients, ranging from enhanced logistics solutions to innovative digital services. Both organizations share similar business models, which will ease the transition and maximize operational efficiencies.

Statements from Leadership

Jens H. Lund, CEO of DSV, highlighted the historical significance of this acquisition. He expressed enthusiasm about merging two strong companies to revolutionize logistics, ensuring benefits for employees, clients, and shareholders alike.

Richard Lutz, CEO of Deutsche Bahn, praised the strategic fit between Schenker and DSV, emphasizing the growth potential for their subsidiary. Jochen Thewes, CEO of Schenker, reflected on Schenker’s impressive legacy and its promising future in conjunction with DSV.

Transaction Details

This acquisition involves notable financial metrics, including an enterprise value of EUR 14.3 billion, with an equity value of EUR 11 billion. DSV aims to finance this through a combination of equity and debt, maintaining strong credit ratings while ensuring resources are allocated for a successful merger.

The transaction will be finalized following approvals from regulatory boards and the German Federal Ministry for Digital and Transport, with completion anticipated by the second quarter. Both companies will maintain their operations as separate entities until the transaction closes.

Employee Relations Post-Acquisition

Post-acquisition, DSV is committed to upholding positive relations with Schenker's workforce, having established social undertakings that will be in effect for two years following the merger.

Strategic Goals and Future Investments

Acquisitions play a pivotal role in DSV's growth strategy, and aligning with Schenker will provide myriad opportunities for expansion and profitability. DSV plans to invest EUR 1 billion in Germany over the next five years, supporting long-term development and job creation. This strategic move is designed to enhance DSV’s offerings in its Air & Sea division, complementing Schenker’s current logistics capabilities.

As they integrate, the two companies expect the synergy to improve their network's efficiency and service offerings, benefiting both customer experience and operational performance across divisions. The aim is to achieve significant profit enhancements by the second year after the merger is finalized.

About DSV and Schenker

DSV is renowned for providing comprehensive supply chain solutions and transport services globally, boasting around 74,000 employees. With a revenue of DKK 151 billion reported in 2023, they remain dedicated to innovation and quality service delivery.

On the other hand, Schenker operates globally, providing exceptional logistics services through land, air, and sea transport. Their commitment to sustainability through innovative transport solutions aligns well with DSV’s vision for enhancing service delivery in a competitive market.

Frequently Asked Questions

What is the significance of DSV acquiring Schenker AG?

The acquisition significantly enhances DSV's position in the transport and logistics industry, creating a major global leader.

What are the expected benefits of this merger?

The merger will generate economies of scale, improve service offerings, and facilitate access to a larger global network.

How does this acquisition affect Schenker's employees?

DSV has committed to maintaining positive employee relations with Schenker staff, with social undertakings planned for two years post-acquisition.

When is the completion of the acquisition expected?

The transaction's completion is projected for the second quarter of the year following regulatory approvals.

How will DSV finance the acquisition?

DSV plans to finance the acquisition with a combination of equity and debt, while maintaining its current credit ratings.

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