KUEHNE & NAGEL EARMARKS $190 MILLION FOR ACQUISITIONS

KUEHNE & NAGEL EARMARKS $190 MILLION FOR ACQUISITIONS

   Kuehne & Nagel, the Swiss forwarding and logistics group, confirmed a plan to increase its share capital by 20 percent and raise about $192 million from the Swiss stock exchange to finance future acquisitions.

   The Swiss group unveiled the ambitious expansion plan as it reported that it increased its net profit last year by 16 percent, the eighth consecutive year of rises in net profits.

   K&N said that it plans to place shares via the Swiss stock exchange during the second half of the year through a secondary placement. The group said that it would ask its annual general meeting on May 15 for approval to increase its authorized capital by a nominal amount of SFr20 million ($13 million), representing 20 percent of the current share capital.

   Based on current share prices, the stock issue transaction will raise about SFr300 million ($190 million), a spokesman for K&N said.

   The increase in share capital “may only be realized in connection with the financing of one or more larger company acquisitions,” the company said.

   Klaus-Michael Kuehne, the majority owner of K&N, intends to offer to the public by secondary placement via the stock exchange up to a further 238,000 shares. This means that the “free float” of shares will in future consist of up to 600,000 registered unitary shares, or 30 percent of the share capital, the company said. K&N expects that this transaction will be concluded by mid-June at the latest.

   “With this step the Kuehne & Nagel group wants to widen its opening to the general public, thus also increasing its reputation among business partners and investors as an internationally leading logistics company,” it said.

   K&N reported a net profit of 95 million Swiss francs ($61 million) for 1999, 16 percent higher than in 1998.

   Group gross revenues increased by 0.2 percent, to SFr6.6 billion ($4.3 billion). Gross profit was up by 2 percent, to SFr1.3 billion ($794 million) and operating profit jumped by 14 percent, to SFr146 million ($94 milllion).

   Broken down by division, K&N reported that its ocean forwarding business made an operating profit of SFr82 million ($53 million) last year, up by 17 percent, on revenues of SFr2.8 billion ($1.8 billion), up by 11 percent. The airfreight division earned an operating profit of SFr44 million ($28 million), up by 14 percent, on revenues of SFr1.5 billion ($979 million), up by 2 percent.

   The group’s European overland arm made a small operating profit of SFr8 million ($5 million) on revenues of SFr713 million ($457 million). The logistics division, which comprises warehousing and distribution activities, reported an operating loss of SFr6 million ($4 million) on revenues of SFr366 million ($235 million).

   Kuehne & Nagel is the latest major logistics provider to go to the stock market to raise equity for expansion funds. Other groups that have listed or are planning to list their companies on the stock market include UPS, Deutsche Post and Stinnes AG, the parent company of Schenker.