Hamburg seems to be developing into a popular shopping mall for the Moeller-Maersk Group. Following the incorporation of the shipping company Hamburg Süd in 2018, the Danes have now announced the acquisition of logistics company Senator International, founded and headquartered in Hamburg in 1984. The step proves that air freight will play a central role for A.P. Moeller-Maersk in the future.
Rumors about the takeover plans had been around for weeks. Now both companies have announced the inking of the deal. According to the agreement, Maersk pays USD 640 million for the acquisition.
The shipping giant can practically pay the amount out of its petty cash due to persistently high transport rates. The bottom line for the period from JUL-SEP21 was a profit of around USD 5.45
billion (EUR 4.7 billion). This corresponds to a fivefold increase in profit over the same quarter of the previous year.
A household name in air freight
Maersk is using the bubbling profits to further expand its transport portfolio; in this case, its air freight business since Senator is a pronounced cargo specialist - the largest, medium-sized air freight forwarder in Germany. Within just a few years, the family-owned company has grown considerably. For example, it manages several cargo flights connecting Asia, Africa, Mexico, and the USA, with car producer BMW being one of its most important customers.
Now the Danes are increasingly focusing on air freight, spurred by the supply chain hiccups in global shipping that have been caused by partial port closures such as Ningbo-Zhoushan in eastern
China as result of a major COVID-19 spread, the ongoing shortage of containers, insufficient maritime transport capacity, and delays caused by handling problems at Long Beach and other major
harbors. This will not change in the short-term, as Jason Chiang from Ocean Shipping Consultants, told the BBC's Asia Business Report. “We don't expect to see any new shipping capacity until
two years down the road.”
Maersk grows own freighter fleet
Given these problems in ocean freight, more and more customers began asking for alternative transport solutions, Maersk says in a statement. This prompted the management to not only acquire Senator, but also simultaneously lease 3 B767-300 freighters from provider ATSG, and order 2 Boeing production freighters B777, ready for delivery in 2024. The latter will be operated by Star Air, Maersk’s in-house aircraft operator. With this decision, Maersk follows the example of CMA-CGM, which already operates its own freighter fleet, whose capacity is marketed by GSA ECS. Competitor Hapag-Lloyd has so far declined to build its own fleet of cargo aircraft to complement its ocean transport services. It remains to be seen whether this might change following the decision of its two largest European rivals to offer the market air freight solutions.
Senator fits well into Maersk’s portfolio. The logistics company manages, among other cargo flights, a transatlantic charter chain, linking Germany with Greenville-Spartanburg in South Carolina. It is the so-called BMW shuttle, operated by B747-400F belonging to Air Atlanta Icelandic’s fleet. Further to this, Senator exclusively manages the handling areas on both sides of the North Atlantic, enabling tailored and fast throughput times.
Air freight complements Maersk’s integrated logistics offering
“As a global provider of integrated logistics, Maersk is improving the ability to provide a one-stop-shop and end-to-end logistics capabilities to our customers,” said Vincent Clerc, Executive Vice President and CEO, Ocean & Logistics, A.P. Moller-Maersk. “We have strengthened our integrated logistics-offering through e-commerce logistics acquisitions, tech investments, expanding our warehouse footprint and, as a natural next step, we are now ramping up our air freight capacity significantly, and creating a broader network to cater even better for the needs of our customers.”
“Founded in 1984 by my father, Uwe Kirschbaum, Senator has developed into a globally renowned freight forwarder,” Senator CEO, Tim-Oliver Kirschbaum emphasized in a statement. “We firmly believe that, by joining Maersk, we will be able to offer an even broader portfolio with our own controlled air capacity as well as other means of transportation.”
The acquisition is subject to regulatory approvals and is expected to close in the first half of 2022.
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