(Commonwealth) _ The CMA CGM Group continues its strategic diversification beyond maritime shipping, focusing on logistics and onshore operations. Through its subsidiary, CEVA Logistics, the company has announced an agreement to acquire Wincanton, a prominent supply chain and logistics firm based in the UK and Ireland. The deal, valued at nearly $720 million, is seen as a significant move to strengthen CMA CGM’s foothold in the strategic region.
CMA CGM Chairman and CEO, Rodolphe Saade, emphasized the alignment between Wincanton and the group’s ambition to expand further in the UK and Ireland. This acquisition is expected not only to enhance the group’s presence in these countries but also to open up new opportunities. Beyond geographic expansion, the deal is set to diversify CEVA Logistics’ customer base significantly. Wincanton, recognized as a trusted supply chain partner for many renowned British and Irish brands, operates across various sectors, including retail, grocery, eCommerce, construction, infrastructure, energy, and defense. With responsibilities extending to the management of warehouses and logistics operations for major companies, Wincanton also oversees a fleet of approximately 8,500 vehicles.
Reports suggest that CMA CGM engaged in multiple discussions with Wincanton’s board before securing their endorsement for the all-cash offer. The offer, providing an approximate 50 percent premium to the current market value of Wincanton, was accepted by the board, who will recommend it to shareholders. This strategic acquisition is poised to reshape the landscape of CMA CGM’s logistics and onshore operations, marking a significant step in their business expansion plan. “In unanimously endorsing this offer to shareholders, the directors believe it serves the interests of all the company’s stakeholders,” stated Sir Martin Read, Chairman of Wincanton. He acknowledged the company’s confidence in its long-term prospects and the broader sector. However, recognizing that the robust performance of the company hasn’t translated into a positive trajectory for its shares in recent years, the board sees this offer as the optimal opportunity for shareholders to realize the value of their investment with greater certainty. With nearly a century of history, Wincanton operates across over 170 sites nationwide, boasting revenues exceeding $1.8 billion and an EBITDA of nearly $154 million in the previous year. Despite its strong growth in recent years, the company’s shares have not reflected this performance adequately. CMA CGM views this acquisition as an appealing growth opportunity, aligning with CEVA Logistics’ expansion strategy.
The purchase is expected to more than double the size of CEVA’s UK operation, which presently generates around $950 million in revenues. CEVA Logistics, under the umbrella of CMA CGM Group, generates approximately $15 billion in annual revenue globally. CMA CGM has been proactive in expanding CEVA Logistics since its acquisition, following a strategy similar to that of A.P. Moller-Maersk, focusing on integrating logistics with traditional shipping operations.
Bolstered by strong profits from its container shipping business in recent years, CMA CGM has executed key acquisitions for CEVA Logistics. Notable among these was the 2022 purchase of the commerce business from Ingram Micro. Additionally, the acquisition of GEFCO, specializing in vehicles and automotive logistics, and the recent launch of vehicle transport operations with a charter for PCTCs (Pure Car and Truck Carriers) from Eastern Pacific have contributed to CMA CGM’s dynamic expansion in the logistics sector. CMA CGM has revealed its latest acquisition even before finalizing the pending purchase of Bollore’s logistics. The company has submitted a substantial $5.5 billion bid for the freight management business, signaling its intent to swiftly conclude this transaction.
