CMA CGM is negotiating with Bolloré SE about buying Bolloré Logistics. The two companies published statements on Tuesday 18th (18/4/23) acknowledging that they were in formal discussions. The CMA-CGM statement asserted that these were “exclusive negotiations to acquire the transportation and logistics activities held through Bolloré Logistics” by CMA CGM. Bollore commented that it had “received a spontaneous offer from the CMA CGM Group for the acquisition of its transportation and logistics activities held through Bolloré Logistics, on the basis of a €5bn cash free / debt free enterprise value”.
According to Bollore, the period of exclusive negotiations will last until May 8th. Its statement gives the impression that a deal is immanent, with the Board of Directors of Bolloré SE already making plans to increase the price of a share buy-back they had proposed in March.
Although this is a significant move for Bolloré SE as it represents the termination of Bolloré’s interest in the logistics sector, it is hardly a surprise. The indication that Bolloré was losing interest in logistics was clear when it sold its valuable African logistics business to MSC Group in December 2022. After this move Bollore Logistics looked sub-scale, with a series of modestly sized forwarding and contract logistics operations in Europe and North America.
CMA CGM is explicit about its reasoning for considering the purchase, stating that it is “in line with the CMA CGM Group’s long-term strategy, based on the two pillars of shipping and logistics. The Group’s strategy is to offer end-to-end solutions in support of its customer’s supply chain needs.”
However, the impression that CMA CGM’s gives about the discussions seems considerably more cautious than that of Bollore, commenting that “the negotiations in no way guarantee an acquisition in the end.”
Whilst this likely acquisition is driven in great part by issues specific to Bolloré and it should also be noted that both sides of the negotiation are French. Nonetheless it is a further example of continuing acquisition activity in the logistics sector. Whether this can be described as ‘consolidation’ is a good question. The sector is likely to remain competitive.
Author: Thomas Cullen
Source: Ti Insights
Supply chain strategists can use GSCi – Ti’s online data platform – to identify opportunities for growth, support strategic decisions, help them stay abreast of industry trends and development, as well as understand future impacts on the industry.
Visit GSCI subscription to sign up today or contact Michael Clover for a free demonstration: [email protected] | +44 (0) 1666 519907
