Four bidders still in the race
Deutsche Bahn can expect around 15 billion euros for Schenker
24.05.2024, 16:57
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For Deutsche Bahn, a sale of its logistics division Schenker could be a much-needed cash injection. The group is burdened with debts of over 30 billion euros. The sale of the subsidiary could probably bring in almost half of that.
According to an insider, Deutsche Bahn can hope to receive more than 15 billion euros from the remaining bidders for its international logistics subsidiary Schenker. The state-owned company is still talking to four bidders about the sale of Schenker, said a person familiar with the negotiations.
These include a strategic investor, a financial investor, a representative from Europe and one from the Arab region. The range of non-binding offers extends from under 15 billion euros to more. What is clear is that CVC is one of them – the only financial investor that made a bid. The buyer is to be selected in the second half of 2024. The deal is to be formally concluded in 2025.
According to sources involved in the sales process, there had previously been six bidders. In addition to the financial investor, these were the Danish DSV, the shipping companies Maersk and MSC, the Saudi investor group Bahri and the Abu Dhabi state fund ADQ. However, the insiders spoke of a restructuring of the consortium. The US investment company Carlyle, which had entered the bid with CVC, is no longer involved. Instead, Carlyle may have joined forces with the Abu Dhabi Investment Authority (ADIA) and the Singapore fund GIC. Neither ADIA nor CVC and Carlye wanted to comment when asked. GIC has not yet responded.
Deutsche Bahn wants to reduce debt burden
Deutsche Bahn did not comment on the selection of the four bidders. A spokeswoman simply explained that the company had received non-binding bids from interested parties by this week. “The process is going according to plan.”
Deutsche Bahn wants to sell Schenker in order to concentrate on the core business of the railway in Germany and to reduce the debt burden of around 34 billion euros. This is important so that the group does not have to accept a loss in creditworthiness. Otherwise it would lead to interest payments on the debt continuing to rise.
However, Schenker has also long been the most important source of profit for the railway. The high freight rates during the Corona period led to a record profit for Schenker of a good 1.8 billion euros in 2022, which, however, had shrunk to around one billion euros in 2023 after business had normalized. Schenker was therefore no longer able to offset the losses of the other railway divisions, so the bottom line was a billion-dollar loss for the state-owned company.
Around 20 years ago, Deutsche Bahn acquired Schenker for around 2.5 billion euros, hoping for synergies with the rail division. However, these hardly materialized. Schenker has over 70,000 employees in around 130 countries worldwide, of which around 15,000 are in Germany.