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French shipping and logistics group CMA CGM has agreed to acquire FedEx Supply Chain, the third-party logistics arm of FedEx, for an enterprise value of USD 1.4 billion, marking a significant expansion of its contract logistics operations in North America. The acquisition, announced during the past week, will be executed through CMA CGM subsidiary CEVA Logistics and is expected to close later this year, subject to regulatory approvals. The transaction will add approximately 150 warehouses and 20,000 employees to CEVA's North American network while strengthening CMA CGM's presence in the US logistics market. Alongside the acquisition, the two companies intend to establish long-term commercial partnerships covering ocean freight and air cargo, as FedEx continues to streamline its portfolio and concentrate on its core parcel delivery operations.
French shipping and logistics group CMA CGM has entered into an agreement to acquire FedEx Supply Chain, the third-party logistics business of FedEx, for an enterprise value of USD 1.4 billion. The transaction, announced during the past week, will be completed through CMA CGM's logistics subsidiary, CEVA Logistics, and remains subject to customary regulatory approvals before its expected completion later this year.
The acquisition forms part of CMA CGM's strategy to expand its integrated logistics operations, particularly in the United States. Following completion of the transaction, CEVA Logistics will add around 150 warehouses and approximately 20,000 employees to its North American contract logistics business, substantially increasing its operational footprint across the region. The expansion is expected to strengthen the group's ability to offer end-to-end supply chain services alongside its shipping, freight forwarding and warehousing operations.
CMA CGM stated that the acquisition aligns with its broader commitment to invest USD 20 billion in the United States over four years, covering shipping, logistics, warehousing and air cargo infrastructure. The company has been diversifying beyond container shipping in recent years through investments in logistics, port terminals and related supply chain businesses to reduce its exposure to fluctuations in the ocean freight market.
Alongside the acquisition, CMA CGM and FedEx plan to establish long-term commercial partnerships spanning ocean freight and air cargo services. Under the proposed arrangements, CMA CGM will become a preferred, non-exclusive ocean carrier for FedEx, while the companies will collaborate on selected air cargo capacity solutions. The agreements are expected to be implemented in phases between 2026 and 2028 and are projected to generate around USD 3.5 billion in revenue over the next decade.
For FedEx, the divestment represents another step in its strategy to focus on its core transportation and parcel delivery operations. The company recently completed the spin-off of FedEx Freight and has been restructuring its business to prioritise higher-margin delivery segments. FedEx Supply Chain, which provides warehousing, order fulfilment and returns management services for major retailers, originated from FedEx's acquisition of Genco Distribution System in 2015.
The transaction further reinforces CMA CGM's position in the global logistics sector by expanding the scale of CEVA Logistics in North America while enabling FedEx to sharpen its focus on its primary delivery business. Upon completion, the deal is expected to strengthen both companies' long-term commercial relationship across maritime and air freight services while enhancing their respective supply chain capabilities.
Source - Reuters
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