Another High Profile Freight and Logistics Acquisition for DSV - This Time in the US

DENMARK – US – International freight and logistics group, DSV, the brainchild of ten Danish local road haulage outfits almost forty years ago, has entered into a definitive agreement to acquire US based global supply chain services and solutions provider, UTi Worldwide, in a deal worth approximately $1.35 billion. The combined companies will have a more balanced geographical footprint with approximately 61% of revenue in Europe, Middle East and North Africa, 17% in Americas, 16% in Asia (APAC) and 6% in Sub-Saharan Africa.

This latest move is typical of the Danish group which lists a number of strategic freight related acquisitions over the last two decades including Samson Transport (1997), DFDS Dan Transport (2000), Bachmann (2004), Frans Maas (2006) and ABX Logistics (2008). Under the terms of the agreement, DSV has offered $7.10 in cash per ordinary share, representing a 34% premium over the 30-day volume weighted average trading price for the ordinary shares and a 50% premium relative to UTi's closing trading price on October 8, 2015. The transaction was unanimously approved by both UTi and DSV's Boards of Directors. Ed Feitzinger, Chief Executive Officer of UTi, said:

"We are very excited to be joining forces with DSV, which we believe will strengthen our value proposition to our clients, while providing a meaningful cash premium to the holders of our ordinary shares relative to the recent trading prices. For our clients and employees, the potential combination of our two businesses has a strong cultural fit, aligned strategy, and a complementary client base and geographic footprint.

“We have the opportunity to draw on the current strengths and scale of both companies to bring solutions to our clients that we could not have delivered on our own. We believe that the $7.10 cash price to holders of our ordinary shares provided by this strategic combination is the best available outcome for ordinary shareholders while allowing us to develop with DSV a nimble, efficient, and comprehensive service offering for our clients."

Headquartered in California, US, UTi is a global, asset-light supply chain services and logistics company, which in the 12 months ending 31 July 2015 achieved consolidated revenues of $3.9 billion. DSV, headquartered in Denmark, is a global supplier of transport and logistics services, which reported annual revenue of $8.7 billion in 2014. Roger MacFarlane, Chairman of the UTi Board of Directors and a co-founder of the Company, said:

"After careful consideration of our strategic alternatives, we believe this combination appropriately recognises the value of UTi's customer and supplier relationships, while providing holders of our ordinary shares with a meaningful cash premium to the recent stock price. This transaction represents an exciting new chapter for UTi."

The acquisition is expected to be completed in the first quarter of 2016, and is subject to approval by UTi shareholders, as well as the satisfaction of customary closing conditions and regulatory approvals. The transaction has fully committed financing and is not subject to any condition with regard to the financing. Kurt Larsen, Chairman of the Board of Directors of DSV, added:

"This is a great step for both UTi and DSV. I know that the combined business and workforce will reach new levels together – we will create a stronger company with an expansive footprint in the 3PL space and an exciting value proposition for our customers. We look forward to joining forces and welcoming our new colleagues from UTi to DSV."