Kuwait's Agility completes sale of logistics unit to Denmark's DSV Panalpina to create $26b freight forwarder
Deal sets up combined entity to be one of world's Top 3 freight forwarders
Dubai: In what is one of the Gulf’s biggest private sector deals this year, Kuwait’s logistics firm Agility has completed the sale of Global Integrated Logistics (GIL) business to Denmark’s DSV Panalpina. The deal is valued at $4.77 billion.
With the acquisition of GIL, DSV becomes a global Top 3 player in the freight forwarding industry with an expected combined revenue of roughly $26 billion and 75,000 employees worldwide.
This will also see Agility pick up a sizeable stake in DSV and will help extend the geographic reach beyond core markets. “In the last decade, Agility created almost $7 billion in value for shareholders, increasing it five-fold since 2011,” said Tarek Sultan, Agility Vice-Chairman and CEO. “We are determined to sustain this momentum going forward.
“We’re moving forward with a strategic investment in DSV, one of the world’s best-performing logistics providers. We will accelerate growth in the businesses we continue to operate, which historically account for around 80 per cent of our EBIT (earnings before interest and tax).”
“We’ve shown that Agility knows how to build and scale successful businesses," said Tarek Sultan, Agility CEO. "This deal affirms Agility’s global strategy and execution, and positions us for a new era of growth.”
Integration to start
In addition to the stake, Agility receives a seat on the DSV board of directors. "There are many similarities when you look at our two companies both in terms of the business models and services," said Jens Bjørn Andersen, Group CEO of DSV Panalpina. "We will now start the integration, and together, we are going to grow the business and bring even more value to our many customers, partners and shareholders than we do separately."
1.4million square metres
The warehousing capacity that Global Integrated Logistics operates.
The merger process will be done country-by-country, which means that "for customers and employees in many countries the coming period will be business as usual until the country-specific merger process is initiated," the company said in a statement.