DSV expects Panalpina deal to complete in Q3 as Q1 profits surge 25pc
DENMARK-BASED freight forwarder DSV expects to close its US$4
DENMARK-BASED freight forwarder DSV expects to close its US$4.6 billion takeover of Panalpina by the end of the third quarter of this year.
While announcing its first quarter results, the freight forwarder said in May DSV will file its planned share purchase with the relevant authorities, announce its public exchange offer and push for shareholder approval of the capital increases needed to fund the takeover.
In June, the listing prospectus will be published, in July DSV hopes the tender offer will be accepted and then regulatory approvals will be obtained, and conditions fulfilled. Finally, the settlement is expected in the third quarter, the company said.
The merger will create a $17 billion revenue global freight forwarder handling 1.5 million tonnes of airfreight per year, reports London's Air Cargo News.
The company saw first-quarter revenues increase by 8.7 per cent year on year to DKK20billion (US$3 billion), earnings before interest and tax (EBIT) was up 25.8 per cent to DKK1.4 billion and net profit increased 25.2 per cent to DKK963 million.
Revenue growth was driven by improvements in air and sea volumes and higher average rates per shipment, as well as extra workings days due to the timing of Easter.
Its airfreight business also had a successful quarter, with first-quarter volumes growing 5 per cent on a year earlier to 170,000 tonnes driven by growth in exports from the Americas, which also helped boost yields. The overall airfreight market is estimated to have decreased by 1 per cent during the same period.
DSV said that the US-China tariff dispute had impacted global growth rates, but its exposure to the trade lane is limited to around 10 per cent of air and sea volumes.
It added that the Brexit situation was also causing uncertainty and was harming European Union growth. DSV is working closely with its customers and has prepared for a worst-case scenario no-deal Brexit. The UK represents around 5 per cent of total DSV revenues.
Airfreight revenues increased by 9.3 per cent year on year to DKK4.6 billion and airfreight gross profit reached DKK1.2 billion, up 15.6 per cent.
DSV Group chief executive Jens Bjorn Andersen said: 'We are very much looking forward to teaming up with Panalpina, and while preparing for the integration, we are focused on delivering good customer service and managing the day to day operations.'