DSV Panalpina Acquired Kuwait’s Agility Unit
DSV Panalpina agreed to pay billions of dollars to acquire the logistics division of Kuwait’s Agility Public Warehousing Co. DSV Panalpina will overtake DB Schenker which is the third largest freight forwarding company at the moment. The latest deal is one of several in recent years as global logistics companies are trying to strengthen their positions.
This deal helped to boost the shares of DSV Panalpina, as its shares jumped 8.4% to reach a record high. It is not surprising that shares of DSV Panalpina benefited from the latest news, as it helped to improve investor sentiment.
Kuwait’s Agility Public Warehousing Co had a revenue of $4 billion in 2020, 80% of which was air and freight. At the moment, 17,000 employees for Kuwait’s Agility Unit.
The company from Denmark operates in more than 80 countries and employs more than 50,000 people. It uses the strategy of growing via acquisitions. In less than two years ago it bought logistics company Panalpina.
It also reported first-quarter operating profit that surpassed expectations. The company raised its expectations for full-year profit. The company’s operating profit before special items stood at 3.07 billion Danish crowns, exceeding the 2.70 billion expected by analysts.
The world’s one of the largest freight forwarding companies raised its forecast for annual operating profit before special items. The company expected the profit to reach from 11.25 billion to 12 billion crowns from 10.5 billion to 11.5 billion.
As part of the deal, the company from Denmark will transfer 19.3 million new shares worth 1 Danish crown each to Agility, representing around 8% of its shares. Consequently, the Kuwait company will become the second largest shareholder in the Danish freight forwarding company.
DSV Panalpina and a historic deal
The company expects the new unit to be fully integrated around the year after the transaction closes in the third quarter. The DSV Pansalpina’s CEO Jens Bjorn Andersen emphasized the importance of the deal in a statement released by the company. According to Jens Bjorn Andersen, Agility’s Global Integrated Logistics business and DSV represent an excellent match.
Agility unit has a strong market position in Asia-Pacific and the Middle East. Danish freight forwarding company will be able to take advantage of that factor.
