Skip to content
Search AI Powered

Latest Stories

newsworthy

Global transport logistics M&A flat year-over-year, PwC analysis says

BG Strategic takes opposite view, cites boom in dealmaking flow

Global merger and acquisition activity in the transport and logistics sector was subdued in the fourth quarter of 2014, finishing a mostly flat year for M&A, according to an analysis released today by the U.S. arm of consultancy PwC.

For the year, there were 208 transactions valued at more than $50 million, resulting in a total deal value of $75 billion, the report said. In 2013, there were 205 deals valued at $75.1 billion. Fourth-quarter deal volume totaled 53 transactions worth $15.9 billion, significantly below year-earlier levels, PwC U.S. said.


Jonathan Kletzel, who heads PwC's transportation and logistics practice, attributed the 2014 declines to 6 percent fewer mega-deals—those valued at $1 billion or more—than in 2013. Most of the big 2014 deals were in the infrastructure category, and involved toll roads and ports, he said. About 47 percent of the dealmaking occurred in the shipping and trucking sectors, with most of the trucking activity occurring in North America, Kletzel said. Half of the acquiring companies were based in the Asia-Pacific region, with 28 percent in Europe and 23 percent in North America, he said.

So-called local transactions accounted for 70 percent of total activity, while cross-border deals, especially in emerging markets, declined, Kletzel said. He expects that trend to continue in 2015, mainly because local transactions involve more redundancies in transportation networks and operations, are usually easier to execute, and yield more synergies than cross-border integrations.

Kletzel said he's cautiously optimistic about 2015 M&A activity, saying the market should be buoyed by an improving U.S. economy, a strong U.S. dollar that will make offshore targets more attractive for U.S. economies, and the dramatic decline in oil prices that should free up more capital for acquisition-based growth and drive expansion plans of some transport operators. Kletzel cited the example of an airline that might be encouraged by lower jet-fuel prices to expand its route offerings, and could make an acquisition to implement that strategy.

Benjamin Gordon, CEO and managing partner of BG Strategic Advisors LLC, a supply chain M&A advisory firm, had a more favorable view of 2014 performance. In an e-mail today, Gordon said transportation and logistics activity was fueled by a massive rise in overall M&A flows. Total U.S. M&A volume hit $1.6 trillion in 2014, a 43-percent jump from 2013 and the highest activity on record, he said. Initial public offerings raised $96 billion last year through 293 deals, the highest level since 2000, he said.

"Overall, we are seeing an influx of capital into the transportation and logistics sector," Gordon said, adding that within the supply chain, "the deal and capital markets are booming." Gordon didn't have a breakdown of 2014 supply chain M&A activity within the total market.

Gordon said the upward trend should continue, because transport and logistics companies have traditionally rewarded investors with attractive returns; banks, private equity and the public markets are eager to fund acquisitions, and publicly held companies must pursue acquisitions to fulfill aggressive expectations for growth.

The Latest

More Stories

ITS Logistics truck carrying Sherwin Williams products
ITS Logistics

Transportation challenges, solved

Sometimes, all you need is the right partner to solve your logistics problems.

In 2021, global paint supplier Sherwin Williams faced driver and hazardous material (hazmat) capacity constraints: There simply weren’t enough hazmat drivers available in its fleet to maintain the company’s 90% fleet utilization rate expectations for key partner store deliveries while also meeting growing demand for service. Those challenges threatened to become even more acute in the future, as a competing paint supply company began to scale back its operations in the Pacific Northwest, leaving Sherwin Williams with an opportunity to fill the gap.

Keep ReadingShow less

Featured

drone flying through warehouse

Robotic revolution

Robots are revolutionizing factories, warehouses, and distribution centers (DCs) around the world, thanks largely to heavy investments in the technology between 2019 and 2021. And although investment has slowed since then, the long-term outlook calls for steady growth over the next four years. According to data from research and consulting firm Interact Analysis, revenues from shipments of industrial robots are forecast to grow nearly 4% per year, on average, between 2024 and 2028 (see Exhibit 1).

market forecast for industrial robots - revenues graphEXHIBIT 1: Market forecast for industrial robots - revenuesInteract Analysis

Keep ReadingShow less
Freight Science dashboard screen
Freight Science

High-tech solution helps truckload carrier drive change

The trucking industry faces a range of challenges these days, particularly when it comes to load planning—a resource-intensive task that often results in suboptimal decisions, unnecessary empty miles, late deliveries, and inefficient asset utilization. What’s more, delays in decision-making due to a lack of real-time insights can hinder operational efficiency, making cost management a constant struggle.

Truckload carrier Paper Transport Inc. (PTI) experienced this firsthand when the company sought to expand its over the-road (OTR), intermodal, and brokerage offerings to include dedicated fleet services for high-volume shippers—adding a layer of complexity to the business. The additional personnel required for such a move would be extremely costly, leading PTI to investigate technology solutions that could help close the gap.

Keep ReadingShow less
indigo software screenshot WMS

Aptean adds British WMS vendor in latest acquisition

The Georgia-based enterprise software vendor Aptean today said it had acquired Indigo Software Ltd., a British provider of purpose-built warehouse management and logistics software solutions.

Terms of the deal were not disclosed, but Aptean said the move will add new capabilities to its warehouse management and supply chain management offerings for manufacturers, wholesalers, distributors, retailers, and 3PLs. Aptean currently provides enterprise resource planning (ERP), transportation management systems (TMS), and product lifecycle management (PLM) platforms.

Keep ReadingShow less
schneider app screenshot for owner operators

Schneider seeks more business with owner-operators

Transportation and logistics service provider Schneider National Inc. is reaching out to owner-operators, encouraging them to do more business with the Wisconsin company using an updated digital platform.

Schneider says its FreightPower platform now offers owner-operators significantly more access to Schneider’s range of freight options. That can help drivers to generate revenue and strengthen their business through: increased access to freight, high drop and hook rates of over 95% of loads, and a trip planning feature that calculates road miles.

Keep ReadingShow less