DSV Intends To Buy The U.S. Giant’s Global Freight Forwarding Business For About $9 Billion
DSV is looking to expand in North America and hopes to gain key access to the trans-Pacific trade market by acquiring C.H. Robinson’s global freight forwarding business, according to sources.
Reuters recently reported that Danish freight forwarding giant DSV is interested in acquiring the global freight forwarding business of its rival, U.S. freight forwarding giant C.H. Robinson, for a price that could be as high as $9 billion, a source told Reuters.
It is reported that DSV is looking to expand its business in North America and met some investors in early June, revealing the above acquisition intention, thereby “obtaining key access to the trans-Pacific trade market”.
The sources also said DSV is not interested in acquiring the entire C.H. Robinson company and has no plans to acquire C.H. Robinson’s freight brokerage business.
Neither DSV nor C.H. Robinson responded to the news.
It is understood that C.H. Robinson has an enterprise value of US$13 billion and has two core businesses of global freight forwarding and freight brokerage.
C.H. Robinson’s global freight forwarding business has significantly outperformed its freight brokerage business. Affected by the epidemic, contract truck rates have struggled to keep up with the busy spot market, but high demand for ocean and air freight has pushed the company’s freight volumes to new highs.
In 2021, C.H. Robinson’s global freight forwarding business revenue will reach $6.7 billion. In the first quarter of 2022, revenue reached $2.2 billion, an increase of 89.8% year over year. Mainly benefiting from the strong market demand and a tight supply of shipping capacity, the freight rate increased significantly. In addition, C.H. Robinson’s increased market share also contributed to revenue growth.
DSV, which has an enterprise value of 239 billion Danish kroner ($34 billion), has long wanted to expand its North American business. DSV has said that it hopes to achieve solid growth in the fiercely competitive global logistics market through integration and acquisitions.
DSV has always been the “acquisition maniac” in the international freight forwarding market, and it has been making big moves in recent years. Including the acquisition of Agility’s Global Integrated Logistics (GIL) unit for $4.2 billion in 2021, and the acquisition of Panalpina in 2019 for more than $5 billion.
A spokesman for DSV said mergers and acquisitions were an important part of DSV’s strategy. The company rewards shareholders by focusing on the market and taking an active role in the ongoing consolidation of the industry. Therefore, DSV will review potential acquisition opportunities.
According to the list of the top 50 global ocean freight forwarders in 2022 published by the authoritative magazine “Transport Topics” in the logistics industry, DSV ranks fourth in ocean freight forwarding and third in air freight forwarding in 2022; C.H. Robinson ranks seventh in ocean freight forwarding, Air freight forwarder №20.
