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Maersk agrees to acquire LF Logistics in an all-cash deal valued at US$3.6 billion
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LF Logistics operates an extensive pan-Asian network specializing in B2B and B2C distribution solutions within retail, wholesale, and e-commerce
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With the acquisition Maersk will add 223 warehouses to its existing portfolio, bringing the total number of facilities to 549 globally, spread across a total of 9.5 million square meters.
A.P. Moller-Maersk announced it has come to an agreement to acquire in an all-cash deal 100% of the shares in LF Logistics Holdings Limited, a leading omnichannel fulfilment contract logistics company operating in the Asia-Pacific region.
The acquisition will further strengthen Maersk’s capabilities as an integrated container logistics company offering global end-to-end supply chain solutions, the company said in a December 22 release.
The deal is one of A.P. Moller-Maersk’s largest takeovers so far after a series of acquisitions including e-commerce firms, a freight forwarder specialized in air freight and its smaller rival Hamburg Sud.
LF Logistics is a Hong Kong-based company owned by Li & Fung (78.3%) and Temasek Holdings (21.7%) that provides contract logistics solutions to customers in Asia-Pacific through two key business units: In-Country Logistics (ICL) and Global Freight Management (GFM).
Besides acquiring LF Logistics, Maersk will partner with Li & Fung in developing logistic solutions, while the parent company of Li & Fung is expected to retain and continue to build the carved-out GFM business following completion of the transaction.
The transaction is valued at US$3.6 billion (enterprise value) and also provides for an earn-out with a total value of up to $160 million related to future financial performance. The acquisition is subject to regulatory approvals and is expected to close in 2022, Maersk said.
LF Logistics operates an extensive pan-Asian network and is the supply chain partner of choice for companies looking to grow in the Asia-Pacific region, said Maersk. It specializes in B2B and B2C distribution solutions within retail, wholesale, and e-commerce.
Since LF Logistics was founded in 1999, the company has significantly expanded its geographic presence and today operates within the ICL business an extensive network of 223 warehouses with a capacity of 2.7 million square meters and approximately 10,000 employees across 14 countries in Asia-Pacific.
In the full-year 2020, LF Logistics reported a revenue of around $1.3 billion and adjusted EBITDA of around $235 million, with the ICL business generating a revenue of around $850 million and adjusted EBITDA of around $230 million, the release said. For the full-year 2021, the ICL business is expected to report a revenue around $1 billion with an adjusted EBITDA around $250 million.
“The acquisition of LF Logistics is an important and truly strategic milestone on our journey to become the global integrator of container logistics; a global logistics company that provide digitally enabled end-to-end logistics solutions based on control of critical assets,” said Soren Skou, CEO of Maersk.
“With the acquisition of LF Logistics, we add critical capabilities in Asia Pacific to support our customers’ long term growth in Asia Pacific as well as capabilities and technology we can scale in our contract logistics business globally,” he said.
Through the intended acquisition, Maersk will add 223 warehouses to the existing portfolio, bringing the total number of facilities to 549 globally, spread across a total of 9.5 million square meters.
“With this move, we will boost our warehousing and distribution offering and respond to the rapidly growing needs of our customers for contract logistics,” said Vincent Clerc, CEO of ocean & logistics at Maersk.
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