Only three of the 27 CEOs who participated in our 2014
surveys reported that their companies had made any significant acquisitions in the previous year, and they said
they expected acquisitions to play a relatively modest role
in company revenue growth over the following three years.
Their average estimates were as follows: North America,
5 percent; Asia-Pacific region, 7 percent; and Europe, 12
percent. It should be noted that 13 of those 27 executives
didn’t expect any of their companies’ growth in the next
three years to come from acquisitions.
Beginning in early 2014, however, the pendulum began
to swing in the opposite direction. As shown in Exhibit 1,
since then there has been a new wave of large-scale mergers
and acquisitions in the 3PL industry.
In January 2014, XPO Logistics announced its acquisition of Pacer International. This was the first of several
recent acquisitions by XPO Logistics. At the time, Pacer
was an asset-light intermodal service company that was the
leading provider of cross-border U.S-Mexico intermodal
services.
In April 2014, FedEx reported its intention to acquire
Genco, a large 3PL with a strong presence in reverse logistics that had positioned itself as the leading provider of
“product lifecycle logistics.” The acquisition, completed in
January 2015, was seen by many as a means by which FedEx
could strengthen its competitive position in the e-commerce space, particularly with respect to handling returns
for e-commerce companies.
Several months later, in July 2014, Norbert Dentressangle,
a large French transportation and logistics service company,
acquired Jacobson Companies, a U.S.-based value-added
warehousing company, for $750 million from the private
equity company Oak Hill Capital Partners. This transaction
would give the French company a much more significant
position in the North American 3PL marketplace. (All
monetary figures in this article are in U.S. dollars.)
The wave of acquisitions continued in February 2015
when Kintetsu World Express, a large Japanese freight for-
warding company, announced it was buying APL Logistics,
a subsidiary of Neptune Orient Lines Ltd. (NOL) for $1.2
billion. APL Logistics, which generated most of its reve-
nues in the Americas, had been established in 1980 as a
logistics subsidiary of a U.S.-based ocean carrier, American
President Lines (APL). It was subsequently sold to NOL in
1997 for $285 million.
In March 2015, Penske Logistics acquired Transfreight,
a company with extensive experience in providing logis-
tics services to clients in the automotive industry. That
acquisition strengthened Penske’s position in servicing the
rebounding U.S. automotive market.
The FedEx buying spree continued in April 2015 when
it agreed to acquire the Dutch company TNT Express for
$4.8 billion. The acquisition of TNT Express, if it receives
approval from the European Union, will provide FedEx
with a very extensive road delivery network in Europe. That
approval is by no means a certainty, however. In January
2013 UPS withdrew its bid of $6.9 billion for the company
after more than a year of negotiating not only with TNT
Express but also with European Commission regulators,
who had threatened to block the acquisition because of
