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Acquiring US-based Ingram Micro CLS will accelerate CMA CGM’s supply chain capabilities in contract logistics and e-commerce expertise
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Ingram Micro CLS will be a key catalyst for CMA CGM subsidiary CEVA Logistics’ development in high-growth e-commerce segment
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With the acquisition, CEVA Logistics will become the fourth largest global contract logistics provider
Shipping and transportation giant CMA CGM group continues to be in acquisition mode, recently signing a deal to buy most of US-based Ingram Micro’s Commerce & Lifecycle Services activities (CLS) to accelerate the group’s supply chain capabilities in contract logistics and e-commerce.
The French company said the agreement will allow it to acquire most of Ingram Micro’s CLS, including Shipwire and the company’s technology forward logistics businesses in North America, Europe, Latin America and Asia-Pacific. The remaining portions of the existing CLS business will be retained by Ingram Micro.
The transaction has an enterprise value of US$3.0 billion and is expected to accelerate the group’s supply chain capabilities in contract logistics and e-commerce expertise, CMA CGM said in a release.
The transaction is expected to close during the first half of 2022.
This comes on the heels of CMA CGM’s announcement early last month that it is acquiring a 90% stake in the Fenix Marine Services (FMS) terminal in Los Angeles, California to strengthen its position as a global port terminal operator.
CMA CGM will fund this latest acquisition from its own resources. The closing of this transaction is subject to regulatory approvals by relevant authorities.
The Marseille-based shipping company is awash with cash as a shipping capacity squeeze has sent freight rates surging to record highs.
The Ingram Micro CLS business being acquired specializes in e-commerce contract logistics and omni-channel fulfillment. The transaction includes Shipwire, a cloud-based logistics technology platform. The acquired business represents estimated annual revenues of $1.7 billion in 2021 and employs 11,500 staff members worldwide across 59 warehouses, with a strong presence in the US and in Europe.
This acquisition will strengthen CMA CGM’s position as a global leader in shipping and logistics, said the statement. Between the carrier’s subsidiary CEVA Logistics and the CLS business, the combined logistics workforce will constitute some 90,000 people across nearly 1,100 sites in 160 countries.
The combination of CEVA Logistics and Ingram Micro CLS activities will create the fourth-largest global provider of contract logistics services.
CMA CGM said this acquisition will further complement CEVA Logistics offering in the contract logistics industry and support its objective to become a top 5 global third-party logistics player.
Ingram Micro’s CLS business will complement CEVA Logistics’ existing e-commerce business and accelerate its growth in key market segments, such as technology, retail and fashion. The CLS business has a strong base in contract logistics with excellent e-commerce capabilities, including reverse logistics management, parcel visibility, and same-day delivery.
The Shipwire order fulfilment platform provides flexible e-commerce logistics solutions for small and medium-sized companies. Shipwire will be able to access CMA CGM’s client base and CEVA’s warehouses to accelerate its development and extend its global footprint.
Together, CEVA Logistics and the CLS business will be one of the world’s leading end-to-end e-commerce services, the release said.
This acquisition is part of the CMA CGM strategy to build and develop extensive transportation and logistics solutions. The group has been accelerating investments to strengthen its shipping and logistics network, targeting solutions to increase supply chain resiliency and fluidity.
Rodolphe Saadé, group chairman and CEO, said, “The acquisition of Ingram Micro CLS is strategic for the CMA CGM Group. After completing its turnaround this year, our subsidiary CEVA Logistics will accelerate its development and join the world’s Top 4 in contract logistics. Its position will be significantly strengthened in the U.S. and European markets, enhancing its ability to seize the opportunities offered by the boom of eCommerce.”
Photo By Bahnfrend
