CMA CGM to acquire FedEx Supply Chain

FRENCH shipping and logistics giant CMA CGM has agreed to acquire FedEx Supply Chain for US$1.4 billion, significantly expanding its contract logistics business in North America.

FedEx Supply Chain operates around 80 facilities, employs approximately 10,000 people, and provides services including warehousing, distribution, fulfilment, returns management and contract logistics for manufacturers and retailers.

Once the acquisition is completed, CEVA Logistics, CMA CGM's logistics division, will almost triple the size of its North American contract logistics operations. The combined business will operate more than 240 locations, including approximately 150 warehouses, with a workforce of around 20,000 employees.

The agreement also includes long term commercial partnerships between the two companies. CMA CGM will become a preferred (but non-exclusive) ocean carrier for FedEx, while the companies will also work together on selected air cargo capacity solutions. These agreements will be introduced progressively between now and 2028.

For FedEx, the sale allows the company to further focus on its core transportation and parcel delivery operations following the recent spin-off of FedEx Freight.

For CMA CGM, the acquisition continues its expansion beyond container shipping into terminals, ports, air cargo, warehousing and contract logistics.

It is another significant investment in the company's strategy of providing integrated end to end supply chain solutions, particularly in the North American market.

This transaction is subject to the usual regulatory approvals and is expected to be completed later this year.