DB Schenker is approved to sell with a valuation of up to 25 billion U.S. dollars!
In September, news pointed out that the German government and the country’s state-owned rail operator, Deutsche Bahn, had agreed to sell DB Schenker, a subsidiary of Deutsche Bahn. Three months later, the news finally landed. On the afternoon of the 15th local time in Germany, the Deutsche Bahn issued an announcement on its official website that they agreed to allow the management to prepare to sell 100% of DB Schenker’s shares.
Deutsche Bahn (DB) said in a statement: The Supervisory Board has assigned the Board of Management to review and prepare the potential sale of 100% of DB Schenker’s shares. The announcement also pointed out that the sale of DB Schenker will further strengthen DB Group’s focus on its strong railway strategy and main business. Launched in 2019, the strategy aims to divert freight traffic to environmentally friendly railways and expand Germany’s rail infrastructure. DB said that DB Schenker needed to go it alone in order to compete in the top echelons of freight forwarders.
DB said in the announcement: With its record performance, DB Schenker has made a significant contribution to the economic growth of the Deutsche Bahn Group over the years. In the medium term, however, DB Schenker will need greater financial resources and greater independence for international acquisitions in order to maintain and increase its market position and future enterprise value in the increasingly competitive logistics industry. This sale will therefore open up new opportunities for DB Schenker in terms of growth and development.
It is reported that DB Schenker’s position as a global market leader makes it very attractive to competitors and investors. Since the economic challenges around the world and the current uncertainty in the capital markets, DB does not wish to rush into the sale of DB Schenker. The specific start date for the divestiture process is subject to the overall situation and has not yet been determined. A sale will only take place if there is a financial advantage for the DB Group compared to retaining DB Schenker.
According to a report from Loadstar, the statement did not mention a possible sale way, but it is understood that DB Schenker’s management is not keen on an acquisition from a competitor (such as DSV). Because only they do like this, the German freight market will not be handed over to competitors, and it also can maintain DB Schenker’s status as an independent German logistics giant.
The industry generally believes that DB Schenker management has always regarded itself as the acquirer of competitors, rather than the party acquired by competitors. It has also been suggested that the company will be sold to a private equity consortium that will take it public in a few years. DB Schenker is undergoing a major restructuring. An analyst said that DB Schenker is valued at about $25 billion, which is a big deal for acquisitions. DB Schenker is one of the world’s leading logistics providers, with more than 1,850 branches in more than 130 countries around the world and approximately 76,100 employees. In the first half of 2022, DB Schenker generated an operating profit of 1.2 billion euros, the best interim EBIT in the company’s 150-year history.
