Swiss transport and logistics giant Kuehne + Nagel International AG (OTC US: KHNGY) said Monday that it closed on the sale of most of its U.K. contract logistics business to U.S.-based provider XPO Logistics Inc. (NASDAQ:XPO), nearly 10 months after the deal was announced.
The transaction, which was consummated after the approval of British antitrust authorities, calls for Kuehne + Nagel to divest itself of logistics operations that supported its food and beverage, retail and technology businesses. Revenue from the divested operations totaled about $656.4 million in 2019, Kuehne + Nagel said at the time the deal was disclosed last March.
The sale, financial terms of which were not disclosed, closes the books on Kuehne + Nagel’s plans that began two years ago to shed non-core contract logistics services. Kuehne + Nagel has already sold its contract logistics business in Argentina, its cool chain fast moving consumer goods portfolio in France and a grouping of real estate assets.
Kuehne + Nagel said it remains committed to e-commerce and pharmaceutical contract logistics services in the U.K. and worldwide.
Though the U.K. business never performed optimally for Kuehne + Nagel, the verticals that XPO has acquired are well within its wheelhouse. It is believed that XPO will get far more mileage out of the assets than did Kuehne + Nagel. XPO said last March that it planned to integrate Kuehne + Nagel’s business onto its technology platform under its pan-European network.
XPO announced in late 2020 plans to separate its transportation and logistics businesses and spin off the logistics operation into a separate company. The initiative is expected to be completed by the end of 2021.