Danish transport and logistics company DSV has confirmed making a proposal to acquire Swiss-based counterpart Panalpina for over US$4 billion.
In a written statement on January 16, DSV said it made the indicative and private acquisition proposal to Panalpina’s Board of Directors, seen as a move to get closer to the world’s top three freight transport companies.
Earlier that day, the Board of Directors of Panalpina announced receiving “an unsolicited, non-binding proposal from DSV to acquire the company at a price of CHF 170 per share, comprising a mix of cash and DSV shares.”
According to its fiduciary duties, the Board of Directors of Panalpina is reviewing the proposal in conjunction with its professional advisers, it added.
”The consideration consists of 1.58 DSV shares and CHF 55 in cash for each Panalpina share. Based on closing prices as of 11 January 2019, the value of the offer is CHF 170 per share,” DSV said, adding that it had not received a response yet from the Board.
Said DSV: “A combination of DSV and Panalpina would create a leading global transport and logistics company with significant growth opportunities and potential for value creation. A combination presents a unique opportunity for both companies and their respective stakeholders including shareholders, employees, customers and suppliers.”
The indicative proposal will provide Panalpina’s shareholders with a premium of 24% to Panalpina’s closing share price of CHF137.5 as of January 11, 2019 and 31% to the 60-day VWAP (volume weighted average price) of CHF129.5 as of January 11, 2019.
The combined business would generate expected revenues of more than DKK110 billion (US$16.8 billion) and EBITDA of more than DKK7 billion on a pro-forma 2018 basis (excluding any synergy benefits).
“DSV has a long and successful track record of partnering with companies, and the combined business will be exceptionally well positioned for future growth,” said DSV.
DSV, the world’s fifth largest freight forwarder, has been expanding rapidly in recent years through a number of acquisitions. Last year, DSV failed in its attempt to buy Ceva Logistics, which favored a “strategic partnership” with its largest shareholder, CMA CGM, which has since made a tender offer for CEVA. If DSV clinches the takeover of Panalpina it would move one place up in the logistics players’ rankings.
