CJ Logistics mulls acquiring Schnellecke to expand in Europe
[THE INVESTOR] CJ Logistics announced on July 31 that it is considering acquiring German logistics firm Schnellecke Group to expand its presence in the European market.
Established in 1929, Schnellecke is a major logistics firm in Europe with sales in 2017 reaching around 1.1 trillion won (US$985.57 million), while posting a net profit of 200 billion won. Industry sources project the German company’s valuation at around 1 trillion won.
According to industry sources, the logistics unit of Korean food and entertainment giant CJ Group has picked law firm Shin & Kim as adviser for the deal and is currently preparing to submit a letter of intent.
This deal is crucial for the Korean company to reach its goal, set two years ago by CEO Park Geun-tae, to become one of the top five logistics firm in the world and increase sales to 27 trillion won by 2020.
“To become one of the top global logistics firm, we have been forming partnerships and conducting M&As over the last five years,” CJ Logistics spokesperson Cho Jung-hoon told The Investor. By acquiring companies, including Rokin Logistics and DSC Logistics, CJ Logistics has been successfully expanding its business in Southeast Asia, US and China. However, its business in Europe is still small. CJ Logistics currently has seven subsidiary firms in Europe which have not seen profits yet.
Moreover, Industry sources say that Schnellecke’s operations in 31 countries, including Russia, India, Mexico and Brazil, also make it attractive.
Established in 1930, CJ Logistics posted 7.11 trillion won in sales with operating profit of 235.6 billion won last year.
By Song Seung-hyun (email@example.com)