Due to the similarities in business DSV says it can integrate the two companies quickly and smoothly
Danish international transport and logistics giant DSV has completed the acquisition of California-based global supply chain services firm UTi Worldwide after striking a A$1.84 billion (US$1.35 billion) takeover deal in October last year.
DSV says this transaction makes it the fourth largest freight forwarder in the world by adding up to 50% to its existing revenue.
“I have no doubt that the combination of the two companies is a recipe for success; and with our united network, we will create exciting opportunities for both customers and employees,” DSV CEO Jens Bjørn Andersen says.
“We will now start the integration process while taking care to maintain a high service level towards all customers. As we move forward, the commercial activities of DSV and UTi will continue under the DSV brand.”
Due to the similarities in business and structure, DSV says it expects to be able to integrate the two companies quickly and smoothly.
The takeover deal was struck in October 2015, nine months after news that Danish transport and logistics company DSV was in talks with US rival UTi.
In DSV’s Hedehusene headquarters, just outside Copenhagen, the company saw fit to offer a 34 per cent premium over UTi’s share price to get the deal done.
“We complement each other perfectly, both in terms of business activities and geography,” DSV chairman Kurt K Larsen said after the deal was announced.
“Together, we will be even stronger and able to capitalise on business synergies as well as a greater global reach to the benefit of shareholders, customers and employees.”
Both firms have a presence in Australia.
Supply chain services and logistics company UTi has reported annual revenues of US$ 3.9 billion but that is seen as underwhelming in a competitive international market.
DSV says acquisitions are an integral part of its growth strategy – in the last three years, it has bought Seatainers Group, Ontime Logistics, SBS Worldwide Holdings and Swift Freight.
UTi chairman Roger MacFarlane said earlier that UTi is expected to increase DSV’s annual revenue by about 50 per cent, “creating one of the world’s strongest transport and logistics networks”.
In 2014 terms, the combined firm would have revenues of about US$ 13 billion and the combined workforce will grow to 44,000 people in 84 countries, 848 offices and 339 logistics facilities.
“The Air & Sea Division will be significantly strengthened, and DSV will increase its industry specific capabilities across all divisions.
“The combined companies will have a more balanced geographical footprint with approximately 61% of revenue in Europe, Middle East and North Africa, 17% in Americas, 16% in Asia (APAC) and 6% in Sub-Saharan Africa,” MacFarlane said.