Megadeals and financial investors determined the transaction landscape in 2019

PwC analysis of global M&A activities in the Transport & Logistics industry in 2019

Contact our expert

Ingo Bauer
Transport, Logistics and Tourism Industry Leader at PwC Germany
Tel.: +49 201 438-1107
E-Mail

Growth in number of deals in the Transport & Logistics sector

The number of mergers and acquisitions in the global Transport & Logistics industry saw an increase in 2019 – in spite of the impending downturn, Brexit confusion and the trade dispute between the United States and China. A total of 254 mergers and acquisitions were announced in the industry worldwide, 12 percent more than in the previous year and just above the average of the past five years. With 135 transactions, the first half of the year was stronger than the second half, in which 119 mergers and acquisitions were announced.

Download study (PDF, 455 KB)

Study overview

Trend towards high transaction values

At $143.3 billion, the total value of transactions in 2019 increased significantly compared to the $116.2 billion of the previous year. This is mainly due to the increase in the number of megadeals. The number of transactions with a value of more than $1 billion rose from 21 to 29 in 2019. This represents 30 percent more megadeals than the average over the past ten years. The total value of these transactions also increased, from $69 billion in the previous year to $92 billion. The biggest transaction of the year was conducted in the US: investment company Blackstone bought a real estate portfolio with a focus on “urban warehousing” for $18.7 billion.

“Compared to other industries, the proportion of deals with targets in Transport & Logistics increased in 2019. The boom in e-commerce played a considerable part in this. Financing conditions remain favourable, which has also enabled large takeovers.”

Ingo Bauer, Transport, Logistics and Tourism Industry Leader at PwC Germany

Infrastructure targets are increasingly popular

Infrastructure targets were the focus of a total of 12 of the 29 megadeals. Logistics & Trucking followed with eight megadeals and, with a total of 94 deals exceeding $50 million value, this subsector remains the most active in the industry.
The increased demand for infrastructure facilities was also reflected in prices, which, despite their general decline among targets in the Transport & Logistics sector, have continued to meet the average of the past ten years. The sales multiple for Transport & Logistics targets decreased by 0.3 points to 1.4 in 2019. The ten-year average is 1.8.

“There is still a lot of money in the market. At the same time, there is a dearth of profitable investment opportunities. Those looking for a secure return soon end up buying infrastructure targets. In times of economic and political uncertainty, they are a comparatively safe investment.”

Ingo Bauer, Transport, Logistics and Tourism Industry Leader at PwC Germany

Financial investors are setting the agenda

A trend that had already become apparent in 2018 has intensified in 2019: financial investors are increasingly involving themselves in deals in the Transport & Logistics industry. With a share of 56 percent, they were more active than strategic investors. Private equity firms were particularly involved in megadeals, being parties in 22 of the 29 deals which exceeded $1 billion. Financial investors have been concentrating on the big deals, particularly aiming for companies from the Logistics & Trucking sector and infrastructure targets.

More activity in Europe

67 deals with European participation were announced, five more than in the previous year. Eight of those were megadeals, such as the takeover of Panalpina by DSV. German companies were involved in six transactions with volumes exceeding $50 million, including a megadeal in which a logistics property portfolio changed hands. There was another noteworthy infrastructure deal in Europe: Chinese investor CASIL sold its shares in Toulouse-Blagnac airport after only four years to Eiffage SA, debunking the myth that China is buying up the West’s infrastructure.

Chinese M&A slump

Overall, there has been a significant slump in Chinese M&A activities. Only three of the billion-dollar deals involved China, while US companies participated in ten of the largest deals. This trend also applies to the deal landscape as a whole: while mergers and acquisitions in the USA remained stable, the number of Chinese deals fell by almost 30 percent.

2020 forecast

The market continues to be characterised by high liquid funds and low interest rates. This is a good basis for positive development in terms of deals. The increasing clarity regarding the Brexit date on January 31st 2020 could also be a positive signal. However, the ongoing trade dispute between China and the USA, subdued forecasts for economic growth and the presidential elections in the US in November 2020 are causing uncertainty.

“Given the current geopolitical and economic uncertainties, we are cautiously optimistic. For Europe at least, we assume that M&A activities will undergo a slight positive development in 2020.”

Ingo Bauer,Transport, Logistics and Tourism Industry Leader at PwC Germany

Methodology

For the report, global M&A activities in the Transport & Logistics industry were recorded between January 1st and December 31st 2019. All deals with a volume of more than $50 million were taken into account. Transactions with a value of more than $1 billion are classified as megadeals. Further details on the methodology can be found in the appropriate chapter of the report.

Contact us

Ingo Bauer

Ingo Bauer

Transport, Logistics and Tourism Industry Leader, PwC Germany

Tel: +49 201 438-1107

Dr. André Wortmann

Dr. André Wortmann

Partner Business Recovery Services (BRS), PwC Germany

Tel: +49 40 6378-1414

Dr. Peter Kauschke

Dr. Peter Kauschke

Director Transport and Logistics, Mobility, PwC Germany

Tel: +49 211 981-2167

Follow us