Months after being rejected by CEVA, the Danish logistics company offered $4 billion for Panalpina.
The Copenhagen-based logistics company DSV said Wednesday that it is offering to acquire Panalpina Welttransport Holding AG for about $4 billion.
The bid to take over Panalpina comes just months after CEVA Logistics rejected a takeover bid in October from DSV in favor of a “strategic partnership” with its largest shareholder, CMA CGM, which has since made a tender offer for CEVA.
Combining with Panalpina “would create a leading global transport and logistics company with significant growth opportunities and potential for value creation,” DSV said. “A combination presents a unique opportunity for both companies and their respective stakeholders, including shareholders, employees, customers and suppliers.”
DSV said that if it combined with Panalpina, the combined business would generate expected revenues of more than 110 billion Danish krone ($16.8 billion) and earnings before interest, taxes, depreciation and amortization (EBITDA) of more than 7 billion Danish krone ($1 billion) on a pro-forma 2018 basis, excluding any synergy benefits.
DSV said it has a “long and successful track record of partnering with companies, and the combined business will be exceptionally well positioned for future growth.” In 2016, DSV acquired Long Beach, Calif.-based third-party logistics company UTi for $1.35 billion
Basel-based Panalpina said its board of directors had “received an unsolicited, non-binding proposal from DSV to acquire the company at a price of 170 Swiss francs per share, comprising a mix of cash and DSV shares” and would review the proposal “in conjunction with its professional advisers.”
DSV said it was offering 1.58 DSV shares and 55 Swiss francs in cash for each Panalpina share, and that based on closing prices as of Jan. 11, the value of the offer is 170 Swiss francs per share.
“The indicative proposal will provide Panalpina’s shareholders with a premium of 24 percent to Panalpina’s closing share price of 137.5 Swiss francs as of Jan. 11, 2019 and 31 percent to the 60-day VWAP (volume weighted average price) of 129.5 Swiss francs as of Jan. 11, 2019,” DSV said.
The market seemed to think Panalpina might command an even better offer: the company’s shares rose more than 30 percent to as high as 180 Swiss francs during trading on the SIX Swiss Exchange.
The Ernst Goehner Foundation owns 45.9 percent of Panalpina’s stock and Cevian Capital owns 12.3 percent.
Reuters reported that Cevian has “urged Panalpina to be open for a takeover.”
DSV did sweeten its initial offer for CEVA after the company rejected its initial offer, but finally threw in the towel after CMA CGM increased its stake in CEVA and announced the strategic partnership.
Armstrong and Associates said that when ranked by gross revenues, DSV is the sixth largest 3PL, with 2017 revenues clocking in around $11.4 billion and Panalpina’s revenues for the year totaling $5.6 billion.
DSV makes acquisition bid for Panalpina
