Tuesday, December 13, 2016

Maersk Subsidiary Sells Container Logistics and Road Haulage Group Pentalver for 87 Million Pounds

APM Terminals Passes on UK Company to US Railroad Group
Shipping News Feature
UK – US – The expansion of US based rail and intermodal group Genesee & Wyoming Inc. (G&W) into the European market continues with the news that it has acquired container transport and logistics specialist Pentalver, a strong player in the British market. Pentalver was owned by APM Terminals, itself a subsidiary of the world’s biggest box carrier A P Møller-Maersk A/S. The move comes less than two years since G&W added the largest rail maritime intermodal operator in the UK, Freightliner to its portfolio and less than four months since it acquired bulk and intermodal operator Providence and Worcester Railroad Company (P&W) back in the US.

Pentalver and G&W say that Pentalver’s activities are complementary to those of Freightliner and, in what is a highly competitive market in the field of maritime container transportation in the UK, the two should make a good fit. With such fierce competition, whether by road, rail or short-sea, with a premium placed by customers on timely, efficient and safe service, G&W expects that the Pentalver acquisition will enable it to both enhance its UK services by providing rail and road transportation solutions, as well as offering storage options at the ports and inland, and unlock efficiencies from shared services and enhanced asset utilisation from the Pentalver trucking fleet and Freightliner’s existing fleet of some 250 vehicles.

From its Southampton headquarters Pentalver operates off-dock container terminals strategically placed at each of the four major English seaports of Felixstowe, Southampton, London Gateway and Tilbury, as well as an inland off-dock terminal located at Cannock, in the Midlands near many of the nation’s largest distribution centres. In addition to providing storage for loaded and empty containers on over 100 acres of land, Pentalver also operates road haulage services with more than 150 trucks, primarily providing daily service between all the seaports in the UK. Pentalver also provides services related to container maintenance and repair (including refrigerated containers) and is one of the largest sellers of new and used containers in the UK.

G&W has agreed to purchase all of the issued share capital of Pentalver for approximately £87 million (or approximately US$110 million at current exchange rates) via its subsidiary, GWI UK Acquisition Company Limited, subject to the usual closing conditions, including the receipt of competition clearances and the finalisation of certain lease agreements, and is expected to close in the first quarter of 2017.

With approximately 600 employees, Pentalver will operate as part of G&W’s U.K./Europe Region and continue to be run by its current Managing Director, Chris Lawrenson,  who commented:

”Upon completion I am delighted that we have a shareholder such as G&W to continue the growth plans of the Pentalver business. Joining the G&W group is a massive opportunity to enhance the services, capabilities and overall capacity of Pentalver and along with subsidiaries such as Freightliner together we will have the ability to offer great services to all customers in the UK. The future is extremely exciting and will be a major step change in the UK container intermodal market.”

The Maersk group has of course itself been going through substantial changes to its operations in the past few months and Joe Nicklaus Nielsen, APM Terminals Vice President and Head of Port Investment, explained the reason for the sale of Pentalver thus:

“This divestment is in line with APM Terminals’ strategy to develop and optimise our portfolio of businesses. Pentalver is a successful business, and we are pleased to have found a new strong owner in Genesee & Wyoming. Together with existing management and the around 600 dedicated employees of Pentalver, Genesee & Wyoming is an excellent new owner that will provide the right platform for customers going forward.”

This move is a another significant step for Genesee & Wyoming which owns or leases 122 freight railroads worldwide and operates throughout ten regions principally the US, Canada and Australia, providing intermodal and bulk transport rail services to over forty major ports worldwide. Jack Hellmann, President and Chief Executive Officer of G&W, commented:

“The acquisition of Pentalver is an excellent strategic fit with our existing intermodal offering in the UK. With the advent of larger container ships and the growth of distribution centres in the Midlands and throughout the UK, our maritime intermodal customers are seeking greater service optionality, which includes not only rail and road transportation but also the ability to store, maintain and position containers.

”Amidst the dramatic changes that are structurally altering the global shipping industry, we are pleased to be enhancing our service capabilities to meet the long term needs of our intermodal customers in the UK. In addition, we are excited to welcome Pentalver’s employees to G&W as we work together with our existing Freightliner subsidiaries to provide the safest, most reliable and efficient transportation services to the UK maritime intermodal market.”

Photo: Pentalver’s talents extend beyond container haulage and handling as this unique development from 20’ and 40’ boxes demonstrates.