DSV looking to acquire US-based transport giant

Logistics company DSV has expressed interest in acquiring US-based logistics group UTi Worldwide at a price of around USD 1.5 billion, says DSV in a brief to the stock exchange issued Wednesday night.

Billion-dollar acquisitions have featured on DSV's agenda for a long time, and now the logistics group confirms that a US-based candidate is in the spotlight - American stock-listed logistics company UTi.

If anything happens between DSV and UTi, DSV will - in addition to its own business with a USD 7.6 billion revenue - take over a logistics player with a revenue of USD 4.4 billion. UTi achieved this revenue in the fiscal year 2013/2014, where the company's adjusted operating profit came to USD 98 million.

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When the stock exchange closed on Wednesday UTi had a market value of USD 1.5 billion, and DSV has previously stated that the Danish company is not intimated by acquisitions of this magnitude.

Like DSV, UTi is a global player. The company has its biggest presence in the US, where - combined with Central and South America - UTi has 33 percent of its business. UTi expects a lower revenue in the fiscal year 2014/2015 than the year before, at USD 2.346 billion.

Find UTi's finances here

UTi - an asset light company, like DSV - has 310 global offices and 259 logistics centers in 59 countries. The company provides services in air and sea freight, contract logistics, distribution, customs brokerage, managed transportation services, supply chain analysis and and consulting.

The company's biggest customer groups, according to UTi, are aerospace and defense, automotive, chemical, consumer and retail, cruise lines, service lines, energy, mining and projects, fashion and apparel, high-tech, pharmaceutical and healthcare.

Discussions revealed last night

DSV's interest in UTi was revealed last night.

"DSV A/S confirms that, in response to an inquiry from DSV A/S, UTi Worldwide Inc. and DSV A/S have conducted certain discussions concerning DSV A/S’ potential acquisition of UTi Worldwide Inc.," said the company in a statement.

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DSV's statement followed an article by Bloomberg revealing the acquisition discussions, but these discussions have now been called off, according to DSV. And UTi made a similar statement in an email sent out Wednesday night.

"UTi can confirm that exploratory conversations have taken place between the companies, in response to an inquiry from DSV A/S, those discussions never progressed beyond a preliminary stage. Currently there are no discussions taking place between the companies," says UTi.

Bloomberg reports that the discussions were only called off when Bloomberg reported on them.

DSV has previously and repeatedly informed that the company is interested in acquisitions, though stating that price and size of the company must be right, and that a potential acquisition candidate must be located outside of Europe. But the company has nothing more to say at this time, beyond the statement, says DSV.

"We cannot comment on anything beyond the statement," CEO Jens Bjørn Andersen tells ShippingWatch.

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