DSV A/S, the world’s fifth-largest freight forwarder, walked away from Ceva Logistics AG after failing in its latest attempt to buy the Swiss company, which says it needed more time to review the offer.
DSV offered 30 francs a share for Ceva, which was rejected by the board, the Danish company said on Oct. 23. That followed a 27.75 franc-per-share cash proposal earlier this month, which valued Ceva at about $1.5 billion. Ceva’s board confirmed having received DSV’s nonbinding letter of interest and said it had engaged with the bidder to allow Ceva Logistics “more time” to review the latest proposal.
Ceva’s board, “has been analyzing, with the support of its advisers, diligently and seriously DSV’s proposal,” Ceva Logistics said in a statement late Oct. 23.
“While the board was considering all the options in the interest of the company and all the shareholders and stakeholders, it notes the withdrawal of DSV’s proposal,” the statement said.
Ceva Logistics said Oct. 11 the board had reviewed” DSV’s initial proposal before unanimously concluding it wasn’t in the best interest of the company or its shareholders. The first offer “significantly” undervalued Ceva, its chairman said that same say in an interview with a Swiss newspaper. Meanwhile, Ceva has modified a stand-still agreement with CMA CGM, allowing its top shareholder to bolster its stake.
“Ceva was a nice to have, not a have to have for DSV,” RBC Capital Markets analyst Damian Brewer wrote in a note. “The decision to walk away from Ceva confirms the strict financial discipline DSV brings to M&A.”
Ceva shares plunged 8.3% Oct. 23, posting their steepest decline since the logistics company sold shares in an initial public offering in May. The stock has lost about 22% of its value since the IPO. DSV shares extended earlier losses and closed 4.8% lower in Copenhagen.
“Based on the unwillingness of the board of directors of Ceva to engage directly with DSV at the price per share offered, we have decided not to pursue an acquisition ,” DSV said in its statement.
Ceva Logistics ranks No. 13 on the Transport Topics Top 50 list of the largest logistics companies in North America