Europe tops the chart for supply chain and logistics deal activity

By James Henderson
Europe led the way for deal volumes within the logistics sector in 2017, according to accountancy and business advisory firm BDO’s Logistics and Suppl...

Europe led the way for deal volumes within the logistics sector in 2017, according to accountancy and business advisory firm BDO’s Logistics and Supply Chain Management M&A Review.

Deal volumes in Europe (including the UK and Ireland) represented 54% of global M&A activity for the year, with 140 completed sales, a level consistent with the previous year.

After a bumper year in 2016 when the total value of deals peaked at £27.2bn globally, activity in terms of value and volume fell in 2017 to £16.9bn disclosed deal values. Average deal multiples fell marginally in 2017, to 13.6x from 13.8x in 2016, but show an upward quarterly trend in 2018.

In particular, supply chain technology is generating significant interest from private equity investors, demonstrated by a growth in the proportion of transactions involving direct investment by financial institutions from 13% in 2015 to 17% in Q1 2018.

Jason Whitworth, M&A partner at BDO, explained: “2016 benefitted from a number of high-value deals, with three transactions above £3bn.


“Lower activity in 2017 may be driven by elements of uncertainty across a number of significant global markets, but large organisations continue to search for profit enhancement through consolidation and smaller niche providers are looking to take advantage of the ever-changing landscape.

“Market disrupters and new market entrants are in a race for technology and automation, driving new business models to deliver against ever increasing customer expectations. This change is propelling investment and transactional activity, as businesses seek to develop innovative and scalable platforms, delivering efficiencies through scale and consolidation.”

Meanwhile, the UK remained a hugely active part of the global logistics market, representing 11% of sales and 10% of acquisitions by volume in 2017. Investment from overseas also remained healthy, with 21% of buyers from overseas in 2017 and the average deal value increasing to £82m.

Whitworth continued: “Despite the uncertainty of Brexit, the UK has seen increased investment appetite and activity from financial institutions as they recognise an opportunity to deliver growth and value. High-growth, entrepreneurially-spirited, mid-sized businesses must continue to champion new technologies and innovation to drive sustainability across the industry.”


Featured Articles

FuturMaster: Unlocking Untapped Potential in Supply Networks

FuturMaster, a pioneer in supply chain planning solutions, has launched the Network Insight Graph in a bid to unlock untapped potential in supply networks

Why you Should Automate your Supply Chain Analytics

Supply Chain Digital takes a look at some key vendors to consider when your business is automating its supply chain analytics

P&SC LIVE New York welcomes Amanda Davies, Mars Snacking

Amanda Davies, Chief R&D, Procurement and Sustainability Officer at Mars Snacking, is set to speak at Procurement & Supply Chain LIVE New York

P&SC LIVE New York welcomes Kirsten Loegering, ServiceNow


P&SC LIVE New York welcomes Dean Ocampo, ServiceNow

Digital Supply Chain

P&SC LIVE London Welcomes New Sponsor – LeanLinking