French shipping company CMA CGM is poised to acquire British logistics firm Wincanton (WIN.L) for £567 million in a cash transaction, marking a significant expansion of the Marseille-based group's logistics operations into the UK supermarket sector.
Announced by both entities on Friday, the acquisition enables CMA CGM, under the private ownership of the Franco-Lebanese Saade family, to enhance its capabilities in warehousing management and grocery logistics. Wincanton operates from over 170 locations throughout Britain and Ireland.
This move follows a series of acquisitions by CMA CGM in the logistics domain, including the recent £4.34 billion offer for Bollore's logistics division – a deal yet to be finalised – and earlier acquisitions of automotive logistics company Gefco and freight forwarding firm CEVA Logistics.
The Saade family, a wealthy Franco-Lebanese dynasty, privately owns the cash-abundant CMA CGM. The group, which saw a surge in freight rates and experienced congested supply chains following the COVID-19 pandemic, is committed to providing comprehensive transport and supply chain management solutions to its clientele.
The firm's all-cash proposal, presented through CEVA, is set at 450 pence per share, representing a 52% premium over Wincanton's closing stock price of 297 pence on Thursday.
This equates to 11.7 times Wincanton's annual underlying earnings before interest and taxes.
Wincanton's board has expressed its intention to unanimously recommend that its shareholders approve CMA CGM's offer, which would result in the delisting of the UK company from the stock market.
The proposal values Wincanton's equity at £567 million on a fully diluted basis, as stated by the companies. Including debt, Wincanton's enterprise value is estimated at £765 million.
"This presents a unique opportunity to broaden CEVA's presence in the UK and to integrate complementary expertise in grocery and consumer sectors," remarked the companies.
Following the announcement, Wincanton's shares surged by 47% in early trading on Friday, reaching their highest point since July 2021.
Wincanton operates in the UK and Ireland, serving sectors ranging from food and consumer goods to fuel and defence, and competes with local firms like DHL and GXO.
The acquisition is being executed by CEVA through a newly established entity, CEVA Logistics UK Rose Ltd.
CMA CGM's financial advisor for this deal is the investment bank Morgan Stanley (MS.N). Wincanton received advisory services from HSBC and Deutsche Numis.