DSV to buy DB Schenker from Deutsche Bahn in US$15.8bn Deal
In something of a groundbreaking deal in the context of the logistics industry, DSV has reached an agreement to purchase DB Schenker from Deutsche Bahn for a sum of €14.3bn (US$15.8bn).
Taking into account expected interest income until completion, the total sales value amounts to €14.8bn (US$16.4bn).
The deal forms a central part of DSV’s ambitious plans to create a global market leader in the transport and logistics sector, with Germany becoming an even more important market to the new organisation. Around €1bn (US$1.1bn) is set to be invested in the country over the next three to five years.
“We have a clear plan for how we want to become one of the world's leading transport and logistics companies together,” comments Jens H. Lund, Group CEO at DSV.
“Hand in hand and under one roof, the employees of DSV and Schenker will combine our strengths to create a true global leader in the industry. This strategic combination with significant investments in competitiveness will ensure long-term growth and create sustainable jobs in Germany.”
DB Schenker: A logistics leader
With around 72,700 employees based in more than 130 countries, DB Schenker is one of the world's leading logistics service providers.
The 152-year-old organisation operates land, air and ocean transportation services, while offering comprehensive logistics and global supply chain management solutions from a single source.
Aiming for a sustainable future in the logistics industry, DB Schenker continuously invests in innovative transport solutions, renewable energies and low-emission products for its customers.
In a statement, DB Schenker said it would be in a position to continue its “dynamic development” in association with DSV, with planned investments from the latter set to drive further sustainable growth.
DSV has also made clear commitments to German co-determination and existing collective and company agreements, while central functions are to be retained, including those at Schenker's location in Essen, Germany.
“With more than 150 years of experience, DB Schenker is one of the strongest and most innovative teams in transportation and logistics,” adds Jochen Thewes, CEO at DB Schenker. “The last few years have been the most successful in our company's history and we have proven that DB Schenker is fit for the future.
“We’re excited about the future prospect of our combined businesses. Together with DSV, our goal is to transform the industry and build a truly global leader with common European roots – for the benefit of our employees and our customers.”
Deutsche Bahn set to focus on rail
The sale of its logistics subsidiary marks the largest transaction in Deutsche Bahn’s history.
CEO Richard Lutz said the deal would provide DB Schenker with clear growth prospects and a long-term home for its employees.
Focusing on its core railway business is seen as a key requirement for implementing its long-term Strong Rail strategy, which, in line with the German government's transport policy goals, is aimed at increasing rail passenger traffic and rail's share of freight traffic.
“In line with our Strong Rail strategy, we are focusing our business on rail infrastructure in Germany that serves the common good as well as on climate-friendly passenger and freight transport in Germany and Europe,” continues Richard. “At the same time, reducing debt will make a substantial contribution to the group's financial sustainability.
“The focus over the next three years will be on the restructuring of infrastructure, rail operations and profitability. This will create a stable basis for the continued growth path of Strong Rail and our contribution to the transport and climate policy goals of the federal government.”
DSV’s agreement to buy DB Schenker is subject to final approval by the Supervisory Board of Deutsche Bahn and the German Federal Government.
The transaction is expected to be completed in 2025 following regulatory approvals.
Check out the latest edition of Supply Chain Magazine and sign up to our global conference series – Procurement and Supply Chain LIVE 2024.
Supply Chain Digital is a BizClik brand.
