M&A activity slows but trucking deals continue

Global consultancy PwC has released the newest edition of its quarterly analysis of mergers and acquisitions (M&A) in the global transportation and logistics (T&L) sector.

The analysis covers all T&L transactions worth US$50 million or more, across passenger air, passenger ground, shipping, logistics, trucking and rail industries.

Global transportation and logistics M&A activity remained stable in the first quarter of 2017, as although deal value grew by two per cent, deal volume declined by nine per cent – breaking an upward trend.

“After several active quarters through mid 2016, deal activity in the Trucking category appears to have tempered, although the recent Swift-Knight merger announcement suggests the forces driving M&A in the category continue to exist,” the report stated.

“Further, we expect the growth in e-commerce and disruptive technologies to continue to spark investing activity in the sector, such as the recent investment by DB Schenker in the online freight booking platform uShip, creating a partnership between the technology start-up and one of the industry’s oldest logistics providers”

Despite a decrease in total deal value in the Asia & Oceania region this quarter, the region continued to drive deal activity across the sector – accounting for 41 per cent share in value and 51 per cent share in volume.

In April, DHL Supply Chain announced the acquisition of Brazilian road carrier Polar Transportes, retaining the company’s management team. Polar Transportes, founded in 1996, has been working as a service provider for DHL for over 15 years and runs a fleet of more than 300 trucks with national coverage.

The acquisition will reportedly support DHL’s growth ambitions in a key emerging market and strengthen the Group’s end-to-end offering for the Life Sciences and Healthcare industry in Brazil.

“Becoming part of DHL Supply Chain is spectacular news for us,” says Polar Transportes CEO Agnaldo Santos.

“Since our founding, we have developed new capabilities and geographies through two acquisitions. Becoming part of our longtime partner DHL Supply Chain is opening up new opportunities for growth and we are looking forward to merge our expertise in cold chain regulations with the resources and competencies of a global player.”

Also in April, UK Hauler Eddie Stobart conditionally agreed to purchase logistics specialist iForce Group in an acquisition stated to be worth around £45m (€53.3 million.

Based in Redditch, UK, iForce Group Limited operates four leased sites plus a further six under licence with its clients, and employs approximately 1,000 people.

Meanwhile, parcel delivery service UPS agreed to acquire Irish express delivery and logistics company, Nightline Logistics Group.

“Operating for more than 40 years in Europe, and almost 30 years in Ireland, UPS continues to build a powerful portfolio of services for our customers throughout the region,” said Jim Barber, President, UPS International.

“Nightline will complement our existing services, increasing delivery density, while also adding innovative new service options. We also look forward to bringing UPS’s extensive healthcare, high-tech and other specialised logistics expertise to the many Irish companies that specialise in these markets.”

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