French shipping firm CMA CGM is set to buy British logistics firm Wincanton for about $700 million in a cash deal that will take the Marseille-based group’s push in logistics into the UK supermarket sector.
The acquisition, announced by the two companies on Friday, would allow CMA CGM, privately controlled by the Franco-Lebanese billionaire Saade family, to add a new layer of expertise on warehousing management and grocery, with Wincanton operating from more than 170 sites across Britain and Ireland.
The transaction comes on the heels of a spree of acquisitions by CMA CGM in the logistics sector, marked by the recent $5.5 billion bid for Bollore’s logistics unit — a deal that remains to be closed — and past purchases of auto logistics firm Gefco and freight forwarder CEVA logistics.
Cash-rich CMA CGM is privately controlled by the Franco-Lebanese billionaire Saade family. The group, which benefited from a hike in freight rates and saturated supply chains immediately after the COVID-19 pandemic, has pledged to offer end-to-end transport services and supply chain management to its clients.
The firm’s all-cash offer, made via CEVA, amounts to 450 pence-per-share offer, reflecting a premium of 52% to Wincanton stock’s closing price of 297 pence on Thursday, or 11.7 times Wincanton’s underlying annual earnings before interest and taxes.
Wincanton said its board intends to unanimously recommend that its shareholders vote in favour of CMA CGM’s bid, which would lead to the UK company being delisted from the stock market.
The offers values Wincanton’s equity at 566.9 million pounds ($718.77 million) on a fully diluted basis, the companies said. Wincanton’s enterprise value, including debt, amounts to 765 million pounds.
“It is a unique opportunity to expand CEVA’s offering in the UK, and to acquire complementary grocery and consumer expertise,” the two companies said.
Wincanton shares jumped 47% in early trading on Friday and touched their highest since July 2021.
Wincanton is active in the UK and Ireland in markets from food and consumer goods to fuel and defence, and competes locally against DHL and GXO.
The acquisition is being done by CEVA through a newly formed entity CEVA Logistics UK Rose Ltd.
CMA CGM’s financial adviser on the deal is investment bank Morgan Stanley. Wincanton was advised by HSBC and Deutsche Numis.
