XPO Logistics has made its biggest acquisition yet and as a result, made that much anticipated leap onto the global logistics stage. Yesterday the US-based company announced its intent to acquire French-based Norbert Dentressangle for $3.53bn.
In the US, Norbert Dentressangle is perhaps best noted for its 2014 acquisition of Jacobson Companies. But it is well-known in Europe as a leading contract logistics provider with a European road fleet network and freight forwarding services. For the 2014 fiscal year, it had revenues of approximately $5.5bn.
With the acquisition, XPO Logistics expands its reach into a Europe that is slowly emerging from a prolonged economic slump and an e-commerce market that is hot. Norbert Dentressangle boasts an impressive list of e-commerce clients including Misguided and ASOS. Its e-fulfillment solutions combined with those of XPO Logistics’ will prove a strong combination in Europe and perhaps cross-border within Europe and between the US as synergies between the two companies take-off.
In addition, Norbert Dentressangle’s road freight network and solutions will complement XPO Logistics’ similar solutions here in the US and will present a compelling selling point for customers interested in expanding in either or both geographies. Both companies appear strong in such industries as automotive and food and perishables. This may result in an interesting competitive threat for fellow US-based C.H. Robinson which has been busy expanding its European network particularly within the food and perishables industry with its Robinson Fresh solution.
And it’s not only Europe in which XPO Logistics will benefit from with this acquisition. Through strategic acquisitions including Norbert’s 2010 acquisition of Schneider National’s freight forwarding operations in the US and China, XPO Logistics will expand its freight forwarding operations into Asia Pacific, Europe and enhance those capabilities further in the US. By connecting the dots, so to speak, this acquisition sets XPO Logistics as a global leader in freight forwarding services.
This is likely not the end to the recent flurry of M&A activity. Consolidation in the logistics industry is long overdue and will continue. For XPO Logistics, acquisitions are expected to continue particularly as noted by Ti’s CEO, John Manners-Bell, “Norbert Dentressangle was not the finished article – it has been growing its freight forwarding business and is weak in Asia – so we can expect its new owners to continue with in-fill acquisitions to address these white-spots.
XPO’s acquisition of Norbert Dentressangle, one of Global Contract Logistics 2015‘s featured providers, demonstrates the value such a company holds within the market. With its contract logistics business, strong European road network, established e-commerce solutions and growing freight forwarding operations across Asia Pacific and the Americas as well as in Europe, Norbert Dentressangle makes for an interesting acquisition target. Global Contract Logistics 2015 contains industry-leading research into development and innovation within the global contract logistics market. The report, due to be published later today (29/04/2015) includes detailed profiles of the leading contract logistics providers including Norbert Dentressangle and its direct competitors. For more information on the report please contact Michael Clover.
GLOBAL SUPPLY CHAIN INTELLIGENCE (GSCi)