Maersk has pulled out of the bidding process for Schenker. In a statement sent to a number of press organisations, Vincent Clerc, CEO of Maersk, said that the shipping line’s “investigations” had confirmed that DB Schenker was an “interesting company” but that “the in-depth review also identified areas of challenges from an integration perspective”.
Mr. Clerc concluded that “acquiring DB Schenker would not be the right thing to do for our business at this time”. What Vincent Clerc seems to be alluding to is the amount of work that it would take for Maersk to integrate Schenker into its business. In particular this appears to focus on the condition of Schenker’s IT systems. This has become central to many large acquisitions, with DSV having made the ruthless integration of its acquisition targets IT systems a foundation of its wildly successful strategy. If this is handled badly it can delay the benefits of the purchase and demand considerable additional investment.
It appears that Maersk publicly dropping-out of the bidding has not had a major impact on the process as a whole. Deutsche Bahn, who are selling Schenker, responded to Maersk’s withdrawal by asserting that the sale of Schenker “going according to plan” and in a statement to the news agency Bloomberg continued that “we are currently in intensive discussions with the various parties interested in DB Schenker…..we will inform of any decisions in due course. The condition for a sale remains that it must be economically advantageous for Deutsche Bahn.”
The rumour earlier in the year was that the strongest bidders were CVC Capital Partners and Carlyle Group who made a joint proposal, possibly supported by the Abu Dhabi Investment Authority and Singapore sovereign wealth fund, GIC, however other opinions have suggested that Maersk was a high bidder as well. DSV and MSC are both believed to have also expressed interest in buying the company.
Author: Thomas Cullen
Source: Ti Insight
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