Danish shipping company, Maersk, has reached an agreement to acquire a Hong Kong-based contract logistics company which specialises in omni-channel fulfilment services, e-commerce and inland transport.
Maersk is set to acquire LF Logistics. The transaction will add 223 warehouses to the existing portfolio, bringing the total number of facilities to 549 globally, spread across a total of 9.5 million square metres.
“The acquisition of LF Logistics is an important and truly strategic milestone on our journey to become the global integrator of container logistics; a global logistics company that provide digitally enabled end-to-end logistics solutions based on control of critical assets,” said Maersk CEO, Soren Skou.
“With the acquisition of LF Logistics, we add critical capabilities in Asia Pacific to support our customers long term growth in Asia Pacific as well as capabilities and technology we can scale in our contract logistics business globally.”
As part of the agreement to acquire LF Logistics, Maersk will enter a strategic partnership with Li & Fung to develop logistics solutions.
LF Logistics operates an extensive Pan-Asian network for B2B and B2C customers within retail, wholesale and e-commerce.
“We recognise that for LF Logistics to be a global leader in the industry, achieving scale is of paramount importance,” said the CEO of Li & Fung and LF Logistics, Joseph Phi.
“Maersk provides the ideal fit for our people and our customers. It has a substantial presence around the world and will utilise LF Logistics’ talent base and operational platform across Asia to build out its logistics and fulfilment offering globally.
“This is testament to the strength of our team, our unique operations-centric culture, and superb growth potential. Together we will deliver a compelling value proposition that allows our people to attain their full potential and our customers to achieve sustainable competitive advantage.”
LF Logistics is a privately owned company by Li & Fung (78.3 per cent) and Temasek Holdings (21.7 per cent). LF Logistics is organised through two business units: In-Country Logistics (ICL) and Global Freight Management (GFM). Founded in 1999, LF Logistics is primarily focused on providing contract logistics solutions to customers in Asia-Pacific. LF Logistics is run as a standalone company separate from Li & Fung. Over the last 22 years, LF Logistics has significantly expanded its geographic presence, with an intention of providing integrated logistics solutions to customers across Asia-Pacific. LF Logistics employs 10,000 people and has 223 warehouses and fulfilment centres in 14 countries totalling 2.7 million square meters.
In the full-year 2020, LF Logistics reported a revenue of around 1.3 billion USD and a post-IFRS 16 adjusted EBITDA of USD around 235 million USD, with the ICL business generating a revenue of around 850 million USD and a post-IFRS 16 adjusted EBITDA of around 230 million USD. For the full-year 2021 the ICL business is expected to report a revenue around $1 billion USD with an adjusted post-IFRS 16 EBITDA around $250 million USD.
Last year, CIMC announced a $1 billion takeover bid for Maersk Container Industry.