DSV is to acquire Panalpina by way of a public exchange offer to all Panalpina shareholders.

 

According to Panalpina, DSV will offer 2,375 DSV shares for one Panalpina share, roughly equating to an offer price of CHF195.8 (US$197.0) for each share.

 

DSV had previously made a cash offer of CHF180 (US$181) per Panalpina share in February 2019.

 

DSV will propose to its shareholders at an extraordinary general meeting that the company changes its name to DSV Panalpina A/S.

 

 

“A combination of DSV and Panalpina further strengthens our position as a leading global freight forwarding company,” said Kurt Larsen, chairman of the board of DSV. “Together, we can present a strong global network and enhanced service offering to our clients, further solidifying our competitive edge in the industry. It’s a great match on all parameters. Panalpina is a great company and we’re very excited by this possibility to join forces and to welcome Panalpina’s talented staff.”

 

If the exchange offer is successful, DSV and Panalpina will have a combined pro forma revenue of approximately DKK118 billion (US$17.8 billion) and a combined workforce of more than 60,000 employees.

 

An integration committee comprising an equal number of Panalpina and DSV representatives will be established to oversee the integration process and ensure fair treatment of all employees.

 

“In the course of the past weeks, Panalpina’s board of directors and management has been exploring different strategic initiatives and held discussions with DSV about a potential combination,” saidPeter Ulber, chairman of the board of Panalpina. “The board of director’s assessment is that the updated proposal of DSV is very attractive. It is recognizing the quality of Panalpina’s employees, the company’s strong position as one of the world’s leading providers of supply chain solutions, and its special competencies and know-how in air and ocean freight. The board of directors recommends Panalpina’s shareholders to accept the offer. Talks with Agility have been discontinued. We are now looking forward to join forces with DSV and contribute to creating one of the world’s largest transport and logistics companies. Our customers will be able to benefit from a stronger network and service offering as well as new competencies and skills.”

 

 

Ernst Göhner Foundation, the largest shareholder of Panalpina with a 46% stake, has agreed with DSV to tender all of its shares in the public exchange offer. Upon completion of the transaction, Ernst Göhner Foundation is expected to become the largest shareholder of the company, with a holding of approximately 11% of the issued share capital.

 

“In view of the ongoing industry consolidation and resulting opportunities and risks, we have carefully considered various options for Panalpina with an open mind,” saidThomas A. Gutzwiller, member of the board of trustees and chairman of the independent Panalpina committee of Ernst Göhner Foundation. “Our board of trustees unanimously concluded that the proposed combination under the umbrella of DSV provides the best opportunities for Panalpina to meet future market challenges from a position of strength and to create value for all stakeholders. As an entrepreneurial foundation with a philanthropic purpose, we feel very comfortable with the announced solution both in terms of quality and security as well as earnings potential. In this spirit of continuity Ernst Göhner Foundation looks forward to supporting DSV Panalpina as the largest shareholder.”

 

The air and sea division of the new company will handle almost 3 million TEUs and more than 1.5 million tonnes of air freight annually, while the solutions division will be strengthened with the addition of more than 500,000 square metres of warehousing capacity.

 

The combination will also increase DSV’s exposure to the Asia-Pacific and Americas markets.

 

Settlement of the offer and completion of the transaction are expected in the fourth quarter of 2019, according to the two companies.