XPO Logistics to buy French rival Norbert Dentressangle for $3.53 bn
29 Apr 2015
US transportation and logistics services company XPO Logistics Inc yesterday struck a deal to buy its larger French rival Norbert Dentressangle SA for $3.53 billion (€3.24 billion) including debt.
XPO, based in Connecticut, said that post merger, the company will have total revenues of around $8.5 billion and will be in the top-10 rankings of global logistics firms.
XPO will the 67-per cent stake held by founder Norbert Dentressangle and his family for €217.50 per share, and then start a tender offer for the remaining stake at the same price, which reflects a 37-per cent premium to Norbert's closing price of €159.10 a share on Tuesday.
The value of the transaction is €2.17 billion, based on 9.9 million outstanding shares. The total deal value is approximately €3.24 billion, including debt of €1.08 billion.
XPO will fund the deal through a financing commitment for up to $2.6 billion from Morgan Stanley, with over $1 billion in cash at hand and an undrawn $415 million bank facility.
The acquisition, which is expected to close in the second quarter of 2015, will increase XPO's pro forma revenue to about $8.5 billion, and earnings before interest, taxes, depreciation and amortization to $545 million, XPO said in a statement.
XPO intends not cut back Norbert Dentressangle's full-time employees in France for at least 18 months from closing, and will maintain its European headquarters in France.
The transaction will give XPO access to Europe's largest fleet network of 7,700 owned trucks, 3,200 trucks contracted through owner-operators and access to an additional 12,000 independent carriers.
The deal will also create a top 10 worldwide contract logistics company based on combined revenue and 129 million square feet of facility space.
Founded in 1979, Lyon-based Norbert Dentressangle is a major global provider of contract logistics, including e-commerce fulfillment, freight brokerage and transportation, and global forwarding services.
The company, which has a presence in 25 countries and annual revenues of €5.1 billion ($5.6 billion), provides supply chain solutions to approximately 20,000 customers, including many of the world's largest companies.
Norbert Dentressangle has customers in retail, food and beverage, manufacturing, chemicals, agriculture, e-commerce and high tech. The company's largest customer represents less than 4 per cent of its annual revenues.
Bradley Jacobs, chairman and CEO of XPO, said, "Our planned acquisition of Norbert Dentressangle will catapult XPO to a top ten global logistics company. It will more than triple our EBITDA to $545 million and increase our revenue to about $8.5 billion upon completion of the tender offer, nearly achieving our 2017 financial targets two years ahead of plan."
Hervé Montjotin, chairman and CEO of Norbert Dentressangle, said, "By joining XPO, we will become part of an organization that shares the ambition that has guided us since the creation of Norbert Dentressangle 36 years ago: to become a global partner able to effectively support our customers in the management of their supply chains. As XPO's platform for growth in Europe, we can continue to pursue this goal on an even larger scale, to the benefit of our customers and employees."
With more than 37,000 deliveries a day, XPO is one of the fastest-growing providers of transportation logistics services in North America. It is the second-largest freight brokerage firm, the third-largest provider of inter-modal services, the largest-provider of last mile logistics for heavy goods, and the largest manager of expedited shipments.
