Germany for sale, crisis makes Germany tremble

Schenker was owned by the German railway company, Deutsche Bahn, and for years formed the backbone of a successful logistics system based on two major ports, Bremen and Hamburg, the railways and their logistics branch. For years, there has been talk of gradual loss of efficiency of the German logistics systemso much so that the hypothesis was put forward of the reopening of the competitive game with the Mediterranean ports, including the Italian ones, which found an invincible enemy in the well-oiled, competitive and to some extent favored by the antitrust authorities German logistics system.

The value of the Schenker acquisition is EUR 14.3 billion. Dsv and Schenker together expect pro forma sales of around €39.3 billion, based on 2023 results, and a combined workforce of around 147,000 employees in more than 90 countries. The acquisition strengthens Dsv’s platform for “growing and developing a more sustainable and digital transport and logistics industry,” it said in a statement. The acquisition will make Germany a key market for Dsv. Several central functions will remain in Germany, including Schenker’s headquarters in Essen. A reassuring statement, but the facts speak a different language. German logistics giant loses ground as industry and it is also losing the ability to colonize other European markets, which it has demonstrated over the years.

As mentioned, Schenker’s corporate cost was set at EUR 14.3 billion and the equity value at EUR 11 billion. At the end of the transaction DSV takes over 100% of Schenker AGincluding all affiliates, in a cash transaction. DSV plans to finance the transaction over the next twelve months through the sale of shares worth approximately EUR 4-5 billion. The pre-IPO phase will be accelerated without pre-emptive rights for existing shareholders and debt financing, in order to maintain current credit ratings. For the transaction, DSV has also obtained related financing lines from BNP Paribas, Danske Bank, HSBC and Nordea.

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DSV has also signed social commitments for Schenker employees in Germany to keep them in work for two years after the closure. DSV delivers and services Supply Chain and Transportation Solutions for thousands of companies every day, from small family businesses to large international corporations, based on a global network and local presence. About us 74,000 employees in over 80 countries. In 2023, the company reported sales of more than EUR 20 billion and earnings before tax (EBIT) of USD 2.3 billion.

The transaction will be subject to approval by the Supervisory Board of Deutsche Bahn and the Federal Ministry of Digital Affairs and Transport (Bundesministrerium für Digitales und Verkehr) in the coming weeks, as well as the usual legislative steps.. The operation is expected to be completed by second quarter 2025 Until the transaction is completed, DSV and Schenker will remain separate companies and continue their normal business operations..

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