FRENCH shipping giant CMA CGM has extended its foray into global logistics with a US$3 billion deal to buy warehouses in the US and Europe and a cloud-based digital platform from US technology group Ingram Micro
FRENCH shipping giant CMA CGM has extended its foray into global logistics with a US$3 billion deal to buy warehouses in the US and Europe and a cloud-based digital platform from US technology group Ingram Micro. The Marseille-based container company made the swoop after benefiting from a sharp rise in prices for international shipping during the pandemic and the economic recovery from the first lockdowns, reports UK's Financial Times.
The new purchase of most of Ingram Micro's Commerce and Lifecycle Services operations includes Shipwire, a cloud-based logistics technology platform, and 59 warehouses worldwide.
It is designed to help CMA CGM make the most of the rapid global growth of ecommerce and compete more effectively against rivals such as DHL and Kuehne+Nagel.
After a period of financial difficulties, the French group is now flush with cash as bottlenecks and logistical problems during the pandemic have boosted freight rates. In September, it even took the rare step of freezing its spot market prices for five months to avoid alienating customers.
Last month, it also used its influx of cash to agree to buy Fenix Marine Services, a container terminal operator at the Port of Los Angeles, in a deal worth $2.3 billion including debt.
The operations of Ingram Micro bought by CMA CGM have an estimated annual turnover of $1.7 billion and employ 11,500 people, raising the headcount of CMA CGM's logistics businesses to 90,000.
Mathieu Friedberg, chief executive of the company's Ceva Logistics unit, told the Financial Times the group would finance the latest $3 billion acquisition from its own resources and pay cash. He said 65 per cent of the new operations were in ecommerce.
Ingram Micro was bought in July by Platinum Equity, the Beverly Hills-based private equity firm, which said the sale of the logistics operations would allow the group to focus on its core technology distribution and cloud services businesses.
Rodolphe Saade, chair and chief executive of CMA CGM, described the latest acquisition as 'strategic' and said: 'After completing its turnround this year, our subsidiary Ceva Logistics will accelerate its development and join the world's top four in contract logistics.
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