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Sunday, February 17, 2019

Maritime Logistics Professional

January 28, 2019

CMA CGM in Effort to Buy rest of CEVA Logistics Shares

File Image (CREDIT: CMA CGM)

File Image (CREDIT: CMA CGM)

CMA CGM launches 30 Sfr/shr tender offer for CEVA shares; CEVA recommends shareholders decline the offer.

ZURICH, Jan 28 (Reuters) - French shipping company CMA CGM on Monday formally launched a cash offer to buy out other shareholders of Ceva Logistics, valuing the Swiss freight forwarder at $1.67 billion as the companies pursue closer ties aimed at fueling growth and savings.

CMA CGM, which already controls 50.6 percent of CEVA, and the Swiss company last year began developing a business plan to boost commercial cooperation and complementary services.

At the time, CMA CGM agreed to make a 30 Swiss franc per share offer for the rest of the Swiss company, following a rejected takeover bid in October by Danish freight company DSV .

CMA CGM, owned by the billionaire Saade family, plans to keep CEVA Logistics listed on the Swiss stock exchange.

CEVA Logistics' board of directors said on Monday that CMA CGM's offer was "reasonable from a financial perspective" and "provides a fair exit opportunity".

As agreed in advance, however, CEVA's board did not recommend shareholders accept the offer on grounds the Swiss-listed company will eventually be worth more as the two companies work together.

"The valuation of the revised business plan indicates a midpoint value of 40 francs per share, well above the share price of 30 francs offered," CEVA Logistics said.

"Shareholders could realise a higher value with their continuing investment," the Swiss company said, adding that it aimed for an intensified business collaboration with CMA CGM while keeping an arm's length relationship.

The offer runs from Feb. 12 to March 12 unless extended.

CEVA Logistics sold shares to the public last May in an IPO, where CMA CGM took a nearly 25 percent stake, before boosting its investment since then.

The companies said in November their expanded partnership -- including cross-selling, simplified organisation and standardised IT systems -- would help boost CEVA Logistics' profitability.

"The industrial project has potential for value-creation and synergies between the two groups," CMA CGM said in a statement after publishing the offer.

"The recommendation to shareholders from the CEVA board not to tender shares in exchange for cash is done in perfect agreement with CMA CGM," the French company added.

CEVA Logistics shares rose slightly to 30 francs.

The carefully orchestrated deal to cement ties comes as the logistics industry is under pressure to consolidate.

The 20 largest freight forwarders -- of which Germany's DHL Logistics is the largest followed by Switzerland's Kuehne & Nagel -- control only about a third of the market. CEVA Logistics is now the eighth-biggest player with about 7 billion Swiss francs ($7.06 billion) in annual revenue.

Earlier this month, Denmark's DSV offered to buy Switzerland's Panalpina for about $4 billion.

In addition to Bank Vontobel acting as manager, lead advisers for CMA CGM's offer for CEVA Logistics are Goldman Sachs and Messier Maris. Financial advisers are BNP Paribas, HSBC and Societe Generale.


Reporting by John Miller

Societe GeneraleSwitzerlandBNP Paribas