Since he took over the leadership of CMA-CGM Group in 2017 from his father Jacques Saadé, Rodolphe Saadé, Chairman-CEO of CMA CGM has made logistics a major focus of his development strategy..
As part of this strategy, in May 2018, CMA CGM confirmed its investment in CEVA Logistics, a global leading player in the logistics sector..
This investment represented 24.99% of CEVA’s capital and took the form of convertible bonds, to be converted into CEVA common shares, upon obtaining all the requisite regulatory approvals..
At the IPO price of 27.5 CHF per share, CMA CGM’s investment amounted to 379 million CHF..
This transaction allows CMA CGM to expand its presence in the logistics sector, which is closely related to shipping.. The two companies reached agreements to explore together the development of joint commercial offerings..
In October 2018, following a $1.5 billion takeover bid from DSV, which was rejected by CEVA in favour of CMA-CGM Group, CMA CGM increased its stake in CEVA to 33 percent..
By taking control of a global player in logistics, CMA CGM will be able to:
- offer its customers complete solutions combining transport and logistics
- complete its maritime transport activity with a less volatile activity
On the 12th of February 2019, CMA CGM launched its public tender offer for CEVA shares..
The offer’s price is set at CHF 30 per CEVA Logistics share.. This values the share:
- 12.2% above its average listing over the last 60 days,
- 62.9% above its CHF 18.42 share price on October 10, 2018, its last day of listing before the announcement of an unsolicited takeover offer by a third party
This offer has the support of the Board of CEVA Logistics..
Commenting on the occasion, Rodolphe Saadé, Chairman-CEO of CMA CGM, stated: “The launch of this public tender offer is in line with CMA CGM’s overall strategy. By developing a logistics offering to complement our maritime activity, we will be able to propose a full ‘end-to-end’ service to our customers.
This is a milestone in the Group’s history. Once the takeover is completed, CMA CGM will become a 100,000-employee strong Group, generating over USD 30 billion in revenue.”
In a press release, CMA-CGM noted that this offer is part of the new strategic plan for CEVA, which has been developed jointly with CMA CGM. Moreover, CMA CGM and CEVA have planned to implement major cooperation programs with the following objectives:
- increase turnover to reach USD 9 billion by 2021 compared to USD 7 billion today (before CEVA’S IPO)
- reach an adjusted EBITDA between USD 470 and 490 million, compared to USD 260 million in 2018
This plan includes:
- commercial synergies by proposing the CEVA offer to CMA CGM customers, and vice-versa,
- integration of CMA CGM’s logistics activity (1,200 people, USD 650 million in turnover) into CEVA to increase CEVA’s footprint in Ocean freight forwarding and allow economies of scale,
- cost reduction with pooled operations, as well as synergies, such as purchasing and shared services.
With this strategic plan, CMA CGM will also provide CEVA with its experience in business transformation.
The CMA CGM Group will thus become a world leader in transport and logistics, with a workforce of 100,000 people, generating over USD 30 billion in revenue..
Source : CMA-CGM
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