Maersk focuses on large land acquisitions
AP Moller-Maersk AS update
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The chief executive officer of Maersk Group stated that Maersk has the ability and willingness to make large-scale land acquisitions to balance the world’s largest container shipping business dominance.
Soren Skou told the Financial Times that the four recent acquisitions — including the two acquisitions of U.S. and European e-commerce logistics groups for more than US$900 million last Friday — made it possible for Maersk to acquire new capabilities and then “accelerate “The growth of these companies.
“Compared to large deals, this is a cheaper way to grow. But we have the financial resources and interest in larger deals. However, we currently don’t see any large deals, so to speak,” Skou added.
Maersk is known as the leader in global trade. One-fifth of the containers cross the ocean to transport goods from Asia to Europe and the United States.
Business is Flourish After years of slow growth after the 2008 global financial crisis, the economic recovery brought about by the Covid-19 pandemic was combined with manufacturers’ attempts to rebuild inventory levels.
“We believe that the current situation is that demand is not being met. Global capacity is insufficient to meet all demand. Our customers are both trying to meet the very strong basic demand driven by the stimulus plan, but also trying to build inventory again,” Skou said.
The Danish group last week increased its full-year profit guidance by approximately 50%, and Say Its current third-quarter performance may be even better than the generous figures for the next three months of this year.
Skou stated that the prosperity of the container shipping industry may last until 2021, but declined to paint the prospects for next year. “Frankly, we have never encountered this situation before,” said Skou, who has been working at Maersk for the past 38 years almost since the beginning of global container shipping.
Skou revolutionized Maersk during his five years in charge, abandoning its oil and other energy businesses to focus on shipping and logistics. His goal is to provide end-to-end services to customers such as sports goods group Puma and furniture retailer IKEA, transporting products from factories to stores by sea and land.
Maersk is increasing the number of logistics services sold to major customers, but many people still only use them for container transportation, and Skou is trying to change this. Logistics revenue increased by 38% in the second quarter, almost entirely attributable to organic growth rather than acquisitions. Maersk’s last major acquisition was the acquisition of Hamburg South America for 3.7 billion euros in 2017, which consolidated its position in the container shipping industry.
Other container shipping companies have begun to order new ships again, hoping that the current surge in demand can continue. But Maersk avoided large orders and focused more on expansion in warehousing, distribution and air freight. It soon hopes that the annual revenue of logistics will reach 10 billion U.S. dollars, while last year’s ocean business (mainly container transportation) was 25 billion U.S. dollars.
Skou said that manufacturers are trying to increase the flexibility of their supply chains by ending their dependence on a single supplier and building more inventory, but Maersk has seen almost no signs of so-called “near shore outsourcing”, that is, the company will produce from Asia. Transfer back to Europe or Europe. US.
He said he wanted Just-in-time supply chain Basically, they have become a thing of the past, because they were “invented in the 1980s, when interest rates were much higher than today”, and now interest rates are close to zero, “customers can afford more inventory.”