Mediterranean Shipping Company (MSC) is continuing its expansion into landside logistics with the purchase of a large container transport business in Britain.
Medlog, which is a subsidiary of MSC, has agreed to purchase Maritime Group Limited, a logistics service provider that is particularly focused on container road freight. On Monday 3/9/24, Maritime Group published a statement that said it had “been acquired by Swiss-based global logistics and supply chain provider, MEDLOG S.A.”. No price for the purchase was given.
Built by the now Chairman, John Williams, through a mix of organic growth and acquisition, Maritime is probably the leading container transport company in Britain. The company states that it has “3,000 employees and a state-of-the-art network of 41 sites across the UK”. Its purchase would give Medlog and MSC a powerful position in landside container transport in the UK.
Medlog, which was established in Antwerp in the 1980’s, has a container logistics network reaching across Europe and has established a presence in North America. It possesses a mix of road, rail and some barge assets. Within MSC it is now complemented by the assets of Metrans, the railfreight subsidiary of Hamburg container terminal operator HHLA, in which MSC is now the leading shareholder.
This purchase seems to be part of a continuing attempt by the leading container shipping lines to construct vertically integrated container logistics services across both land and sea. This is not unprecedented, some tried to do this in the 1990’s. However, the three leading carriers now have greater market share and more profitable businesses than previously. MSC has a share of approximately 20% of the container market and this may be a sufficient basis to sustain an economically viable landside logistics capability based on in-house physical assets. Not all container shipping lines or forwarders would want to utilise the resources of their competitor, not least as there would be a question over the neutrality of servicing and pricing. Yet many smaller forwarders and shipping lines might be interested, especially if they were offered a service that benefited from economies of scale. The landside container logistics sector is still often fragmented with weak profitability. Still, there may be a chance that it is seeing the sort of consolidation that the container shipping sector has seen over the past couple of decades.
Source: Ti Insight
Author: Thomas Cullen
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