Lyon, France-based Norbert Dentressangle, a $5.5 billion global third-party logistics (3PL) services provider focused on global logistics, transport, ocean, and air services, said today it has acquired Des Moines, Iowa-based Jacobson Companies, a value-added warehousing (VAW) company, for $750 million from private equity firm Oak Hill Capital Partners.
With more than $800 million in annual revenue, Jacobson is one of the largest VAW players in North America. It has 5,500 employees and more than 3 million square meters of leased warehouse space. Norbert Dentressangle officials said the deal is expected to close in September (and is subject to regulatory approvals) at which time Jacobson will be rebranded as part of Norbert Dentressangle and its Iowa headquarters will function as North America headquarters for Norbert Dentressangle.
Norbert Dentressangle noted that this deal “immediately positions” the company as a leading 3PL in the United States and will become the fifth largest provider of contract logistics in the U.S. upon completion of the acquisition.
“The acquisition of Jacobson is a key milestone in Norbert Dentressangle’s development strategy to become a top-tier player in global supply-chain management and a step change in expanding our global reach,” said Hervé Montjotin, Chief Executive Officer of Norbert Dentressangle, in a statement. “As a leading contract logistics provider in the buoyant U.S. logistics and transport sector, Jacobson is an ideal strategic fit for Norbert Dentressangle. Jacobson’s success has been founded on core traditions of operational excellence and customer focus and it has built a strong track record of growth and profitability. Its entrepreneurial spirit and management team will fit perfectly with the Norbert Dentressangle Group. I am convinced this deal will create new opportunities for the employees and customers of Jacobson, and am confident about our ability to quickly and smoothly integrate the Jacobson teams into Norbert Dentressangle. ”
In an interview with LM, Montjotin said that with an established presence and foothold in Europe, it made sense for the company to expand outside the continent and into the U.S.
Moving into the U.S. through the acquisition of Jacobson, he said, made sense for a few reasons, including: the strong momentum of the U.S. economy; the growth of the 3PL sector in the U.S.; and the high level for growth potential in the U.S. compared to Europe.
In terms of what made Jacobson attractive as an acquisition target, Montjotin noted a key driver was the vertical markets Jacobson serves in consumer packaged goods, food and beverage, chemicals, and agriculture.
“All of these verticals are very comparable to the ones we are addressing in Europe,” he said. “Jacobson has a scalable platform for the U.S. to serve any concerns anywhere in the country, and we feel there is really a strong cultural fit with them, even though the U.S. market is different from Europe.”
Upon the transaction’s completion, Montjotin said things in the U.S. will be “business as usual” with a focus on growth at a good pace in the future.
Norbert Dentressangle said that when Jacobson officially becomes part of the company, its scale will increase in the global market by 15 percent to $6.8 billion in annual revenue, as well as in the U.S. market, where it said it becomes scalable with roughly $800 million of annual gross revenues in 2013. What’s more, it added that the deal will allow for Norbert Dentressangle to expand its geographical reach in the U.S. logistics and transport sectors, with the potential for future expansion and development.
And through the integration of Norbert Dentressangle’s ocean and air services into the U.S. market, the pairing of Norbert Dentressangle with Jacobson allows the company to “offer fully integrated value-added services to its customers [and Jacobson’s] both in the U.S. domestic market and globally,” it said. This acquisition also helps to establish cross-selling business opportunities in the U.S. and globally, said Norbert Dentressangle, with the companies sharing best practices for things like engineering, IT, and automation processes, and also expand co-packing activities, reverse logistics, and e-commerce logistics, with a focus on contract logistics.
Evan Armstrong, president of supply chain consultancy Armstrong & Associates, described this deal as a “major transaction by Norbert Dentressangle to gain a foothold in the North American 3PL Market and is one of the largest acquisitions by a European 3PL in the U.S. Market in recent memory.”
With its three divisions–– Logistics (warehousing), Freight Forwarding, and Transport––and significant business in Food & Grocery, CPG, and Retail, Armstrong explained this also makes it a good match for Jacobson, adding that some of Norbert’s key accounts include B&Q, Danone, PepsiCo, and Tesco.
He also pointed out this is not the first time Norbert Dentressangle has grown through acquisition, citing how in 2010 it added in-house freight forwarding capabilities and expanded those capabilities and international presence when it acquired Schneider Logistics’ freight forwarding division in the U.S. and China, and in March 2011 it acquired British freight forwarder TDG, and in December 2011 it acquired Chinese freight forwarder APC Beijing International. Its most recent acquisition prior to Jacobson was the Daher Group’s freight forwarding activities in France and Russia in September 2013. Armstrong said Norbert Dentressangle’s Freight Forwarding division has 57 offices in 14 countries, with Europe generating 53 percent of the business, Asia 25 percent, and the Americas region accounting for the rest.
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