How crazy is this: DSV goes hostile on Expeditors or CH Robinson?
Flying low, way too low…
As I ponder whether any freight forwarder – apart from Panalpina – could be poised for a change of ownership, more evidence emerges in the annual results of market leader DP-DHL that major asset-light logistics operators have arrived at a critical juncture.
Market conditions
Oh yes, I am looking forward to sifting through the full financial results of the German behemoth next week. But briefly, it is important to flag certain warning signs in its trading update, dated 8 March, which shows ...
FAK rate hikes holding, with strong demand into peak season predicted
DSV could face $16m bill after helicopter is written off in haulage accident
Déjà vu as major ocean carriers scramble for tonnage and containers
Rising costs of port congestion force surcharge by Asian feeder operators
Trade growth getting stronger, but ocean freight rates stay flattish
Indian trade disrupted as port congestion forces liner services to skip calls
Global airfreight volumes blooming as flower shipments take off
Comment on this article
Jb
March 11, 2017 at 7:28 pmThis is the most impossible and unlikely merger. You’ve done much reading up on expeditors, but if you’ve paid attention to their 8ks, you’ll know that they are ‘not for sell’.
Ale Pasetti
March 13, 2017 at 9:35 amThanks for stopping by, jb.
So, if you are referring to a takeover by DPDHL, we might well agree — “only circumstantial evidence indicates that DGF would be attracted to Expeditors,” I wrote.
Everything is up for sale if the price is right, given the free float etc etc.
Scm
May 01, 2017 at 4:24 amHi Allesandro,
I’m afraid you misunderstand the motivations that drive management behavior at Expeditors. Maximizing shareholder value by implementing policies to increase the share price is not their mindset or priority. The company exists to maximize profit-share payouts to branch operations leadership. The people running expd have little to no interest in striking M&A deals that would jeopardize that model.
If there’s a proxy fight, management wins this one.
Good, detailed, interesting article nonetheless, thank you for the good read.
Ale Pasetti
May 03, 2017 at 5:23 amScm,
As I have acknowledged in several articles, I am aware management is not interested in M&A.
“Maximizing shareholder value by implementing policies to increase the share price is not their mindset or priority.”
Its recent share action proves you are right, given its near-4% drop, and the same holds true when you consider its 10-year performance, during which little value has been created ex dividends.
EXPD will be sold eventually, and that is inevitable.
Best,
Ale