In a deal that will surely shake up the power rankings among the top logistics firms worldwide, U.S.-based transporter XPO Logistics and French logistics firm Norbert Dentressangle have struck a deal for the prior to acquire a majority interest in the much larger Dentressangle. The deal is worth US$3.56 billion, including $1.2 billion of net debt. Once the purchase is finalized, perhaps as early as June, XPO is poised to become a top-ten worldwide logistics company, boosting revenues to around $8.5 billion.
Under the terms of the agreement, XPO will purchase the 67 percent of the shares owned by the Dentressangle family, which represents $243 per share. XPO will then launch a tender for the remaining shares. Upon the news of the acquisition, XPO’s shares rose 12 percent to $47.50 on the New York stock exchange.
The board of directors of XPO and the supervisory board of Norbert Dentressangle have both approved the acquisition. The only hurdles that remain are antitrust clearances from the U.S. and Germany. There is no financing contingency; Morgan Stanley has provided a financing commitment for up to $2.6 billion; XPO has over $1 billion in cash.
Dentressangle, based in Lyon, will not lose any of its staff in France, which represents two-thirds of the business, for at least 18 months after the deal closes. Hervé Montjoitin, chairman of the executive board and CEO of Norbert Dentressangle, will serve as CEO of XPO’s European operation and president of the parent company. XPO plans to keep Dentressangle’s headquarters in Lyon.
The deal will give XPO access to a fleet of 7,700 owned trucks, 3,200 trucks contracted through owner-operators and access to an additional 12,000 independent carriers. XPO plans to rebrand the fleet and entire operation under the name XPO Logistics. The company expects to have 52,350 employees at 863 locations in 27 countries.
Bradley Jacobs, the logistics chief executive for XPO told The Loadstar, “there was no ‘for sale sign’ at Norbert Dentressangle, but when we looked at what our organizations would look like together, it became a very compelling deal.”
Photo: CEO of Norbert Dentressangle/Reuters