DSV has cleared a major hurdle in its planned acquisition of DB Schenker after the European Commission approved the deal.
Yesterday marked the deadline for the Commission to comment on the deal, and whether any measures would need to be taken for the acquisition to go through.
The commission said it had “concluded that the notified transaction would not raise competition concerns, given its limited impact on competition in the markets where the companies are active.
“In particular, the Commission examined the effects of the transaction in several national markets for land, air and sea freight forwarding and contract logistics services in the European Economic Area. The Commission found that the transaction does not raise concerns given the fragmented nature of such markets, and the existence of several alternative providers to which customers could switch following the transaction. The notified transaction was examined under the normal merger review procedure.”
Some 35 authorities have now cleared the merger; only the US Department of Justice still needs to approve it.
But according to Bernstein: “The company has filed with the DoJ, and we expect a decision around the end of the month. We see no credible antitrust case in the US, given the parties’ higher market shares in the EU.”
Once the US approval has been secured, DSV plans to complete the acquisition of Germany’s DB Schenker in the second quarter.
DSV, during the battle to win Schenker, reportedly pledged to retain “important central functions of Schenker in Germany… including IT in Essen and Frankfurt”.
It said: “In addition, joint management teams consisting of executives from both companies are to be appointed for the new organisation. The integration approach will be based on the ‘best athlete for the job’ principle for all positions.”
DSV had also acknowledged that while there will be job cuts in the medium-term, jobs would be created in the longer term.
“In five years, more employees will be working for the combined organisation than today at Schenker and DSV – worldwide and in Germany.”
German media reported that overlaps between DSV and Schenker would likely mean some 1,600 to 1,900 job cuts, or 13%-15% of the full-time positions in Germany. However, DSV has promised no cuts for at least two years after the deal closes.
