CMA CGM Group has agreed a Share and Asset Purchase Agreement with Ingram Micro to acquire “most” of the latter’s Consumer and Lifestyle Services (CLS) business. The deal includes Shipwire and the CLS technology forwarding operations in the Americas and Europe, with remaining CLS business staying with Ingram Micro.
CMA CGM stated the newly combined CEVA Logistics and CLS entity will extend to 1,100 sites in 160 countries, with the CLS business adding $1.7bn in revenue to existing operations. The rationale behind the deal appears twofold. Firstly, CLS will complement CEVA’s existing e-commerce business with the addition of visibility, same-day delivery and reverse logistics operations. Secondly, the deal includes Shipwire which allows CEVA Logistics to integrate a cloud-based order fulfilment platform that targets SME e-commerce retailers. That Michiel Alting von Geusau, currently the EVP and President of Global Commerce & Life Cycle Services at Ingram Micro, will “continue to lead the business within CEVA Logistics,” suggests knowledge of the potentially complex operations and IT infrastructure is central to the integration process.
Speaking on the acquisition, Rodolphe Saadé, Chairman and CEO of the CMA CGM Group, said, “The acquisition of Ingram Micro CLS is strategic for the CMA CGM Group. After completing its turnaround this year, our subsidiary CEVA Logistics will accelerate its development and join the world’s Top 4 in contract logistics. Its position will be significantly strengthened in the U.S. and European markets, enhancing its ability to seize the opportunities offered by the boom of eCommerce.”
CMA CGM is not the only shipping line looking to gain its share of the e-commerce spoils. Maersk has been active in M&A markets over the last two years, adding US-based e-commerce logistics and parcel delivery company Visible Supply Chain Management in an August 2021 deal, amongst others. Indeed, Maersk and CMA CGM appear in many ways to be heading in a similar direction, albeit via markedly different paths, with each building logistics businesses that complement vast shipping operations that push both into the end-to-end supply chain game.
The shipping market has seen an unprecedented boom in 2021 and while that appears to have several quarters left to run, structural changes and significant new capacity will change those dynamics from 2023 onwards, if not before. With bust very often following boom in the shipping market, carriers may find themselves competing as much against a shortening timeline than anything else to ‘complete’ their logistics services.
Source: Transport Intelligence, 9th December 2021
Author: Nick Bailey
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