Two years after acquiring Panalpina, DSV is once again announcing a large acquisition: Agility Global Integrated Logistics (GIL) in a deal valued at US$4.2 billion.

In a statement, DSV Panalpina cited the numerous benefits of such an acquisition — which it expects to close in Q3 2021 — and will create the world’s 3rd largest transport and logistics company based on revenues.

With the transaction, Agility will become the second-largest shareholder in DSV with an approximate 8% stake in the combined company.

"Global Integrated Logistics is part of Agility and one of the world’s top freight forwarding and contract logistics providers (3PL). In 2020, the company had US$4 billion in revenue, mainly related to air & sea freight, and a workforce of approximately 17,000 employees," the Danish transport and logistics company said.

"DSV recently completed the integration of the company’s largest acquisition to date, the Swiss Panalpina, and with the acquisition of GIL, DSV Panalpina will become the world’s 3rd largest transport and logistics company with a combined pro forma revenue of approximately DKK 142 billion (around US$22 billion) – an increase of around 23% – and a combined workforce of more than 70,000 employees," it added.

Boost in air, sea & road operations 

DSV noted that its Air & Sea division, the largest division of DSV Panalpina, will be substantially strengthened with the acquisition of GIL and will consolidate the rank among the largest providers globally with close to 2.8 million containers (TEUs) and more than 1.6 million tonnes of air freight transported annually, it added.

"The contract logistics capabilities, which are increasingly important due to complex supply chains and changing distribution channels, will strengthen DSV’s Solutions division with GIL’s additional warehousing capacity of more than 1.4 million square meters, mainly in APAC and the Middle East," DSV further said.

GIL, it added, will also add road freight activities to DSV’s network in both Europe and the Middle East and thereby increase DSV’s competitiveness across all three divisions.

Group CEO of DSV Panalpina, Jens Bjørn Andersen, said DSV and GIL are a strong match with valuable synergies as a result of similarities in both business models, services, and strategies — part of the many good reasons to join forces with the Middle Eastern transport and logistics provider.

“GIL and DSV are an excellent match, and we are proud that we can announce our agreement to join forces. The combination of our two global networks will provide us with the opportunity to offer our customers an even higher service level,” Andersen said.

“GIL’s strong market position in APAC and the Middle East complements DSV’s network well and will support our long-term value creation ambitions. Our two groups already share a culture of entrepreneurship and local ownership, and we look forward to welcoming GIL’s talented staff to DSV,” he added.

Approval by Q3 2021

DSV has long been known for its acquisition strategy, including the most recently Swiss Panalpina in 2019 and American UTi Worldwide in 2015.

The firm said the “focus on scalability” remains one of the key competitive advantages in freight forwarding with significant operational and commercial benefits in a highly fragmented market.

Agility’s vice-chairman, Tarek Sultan, said the firm “remains committed to the supply chain industry.”

“Agility will be exploring opportunities between DSV and its other businesses, with promising areas of future cooperation potentially including Agility’s Logistics Parks business, Shipa group of companies, and technology ventures. Agility will remain an emerging markets leader, investor in emerging technologies, and champion of sustainable business,” he said. 

DSV Panalpina and GIL expect to close the transaction in the third quarter of 2021 provided conditions are met and necessary approvals are obtained.

In its statement, DSV said until then, DSV Panalpina and GIL will continue to operate separately and independently.

Meanwhile, not part of the deal is Agility’s Logistics Parks business that develops warehousing and light-industrial infrastructure, and its portfolio of subsidiary companies, covering fuel logistics, commercial real estate, airport services, customs digitization, and digital logistics, among others.

Agility said it will continue to invest in emerging technologies and companies and remains committed to sustainability across its operations and the companies it invests in.