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Maarten Reinders
Download ReportForeword
Thank you for taking the time to read this European sector monitor on the Transportation & Logistics sector. This report brings together extensive research on M&A activities within the sector, along with other data and insights. We have been producing regional monitors for years, but this is the first time we are specifically focusing on a particular sector across Europe.
Our goal is to improve market transparency across Europe and provide a valuable benchmark for M&A professionals. By sharing this information within our network, we aim to elevate the quality and increase the volume of successful deals in the sector.
Floyd Plettenberg MSc. EMFC
CEO Dealsuite
I Industry overview
The Transportation & Logistics sector in Europe plays a pivotal role in the continent’s economic framework, enabling the smooth movement of goods and people, essential for maintaining the flow of trade. The leading transportation industries in the European Union generate several million jobs and over 1.3 trillion euros in turnover (Statista, 2024). The Transportation & Logistics sector is diversified into several key sub-sectors, each contributing uniquely to the economy.
Most active countries in road freight transport
The following countries transported most of the EU’s road freight.
Most active countries in rail freight transport
The following countries were most active in rail freight transport, measured in tonne-kilometers, which combines the weight of the goods transported and the distance they are moved.
Most active maritime freight ports
These two ports alone managed nearly one-fifth of all maritime freight in the EU.
Air freight transport
Top 5 main cargo airports in terms of goods loaded and unloaded.
Lowest transport prices in the Baltic, Eastern, and Southern Member States
In 2022, transport prices matched or exceeded the EU average in every Nordic and Western EU Member State. Conversely, the price levels in the Baltic, Eastern, and Southern Member States were below the EU average. The highest transport prices were observed in Denmark and Sweden, whereas Bulgaria, Romania, Poland, and Hungary registered the lowest prices. (Eurostat, 2023)
II M&A activity
Serial acquirers play a key role.
The M&A activity in Europe’s Transport & Logistics sector continues to thrive, driven by mergers, acquisitions, and broad consolidation across all areas. Serial acquirers play a significant role in merging companies, especially in the UK, DACH region, France, Scandinavia, and the Benelux countries.
Cross-border deals in the logistics sector
According to Deloitte, from the deals that occurred in the period 2019 to H1-2023, 4 out of 10 deals involved a foreign buyer. The importance of foreign buyers varies significantly across (Western) European countries. For example, in France, only 22% of deals are cross-border, whereas in the Netherlands, over half of the deals involve foreign buyers.
According to the Dealsuite M&A Monitor of September 2022, over half of the advisors reported an increase in the number of cross-border deals in the five years prior.
Development of the number of cross-border deals
II M&A activity
More transactions in Transportation & Logistics sector.
The Dealsuite M&A Monitor of February 2024 reports the relative distribution of transactions per sector in the mid-market. The figure below shows the distribution. 10% of all transactions were closed in the Automotive, Transportation & Logistics sector. This sector also saw the biggest increase in percentage points in H2-2023.
II M&A activity
Analysing Dealsuite platform data from May 2021 to May 2024 reveals that most sell-side deals in the Transportation & Logistics sector fall within the €1 to €3 million range, accounting for 29% of the total. Additionally, 15% of sell-side deals exceed €20 million. This ratio is also a good representation of the market, as there are more smaller firms than larger ones.
III Valuations
Big difference in average EBITDA multiple per region, highest multiple in DACH.
The figure below shows a comparison of average EBITDA multiples by sector between key Western European countries. Compared to other sectors, the reported EBITDA multiples for the Automotive, Transportation & Logistics sector are relatively low. Businesses in this sector in the United Kingdom and Ireland are reported to have an average EBITDA multiple of 3.5 compared to an average EBITDA multiple of 4.5 for a similar company in the DACH region.
EBITDA multiples are a key metric in evaluating company valuations and can vary significantly across different regions. The differences can serve as a significant motivator for cross-border deals. Judging from the averages, it can be advantageous for investors to consider acquiring Transportation & Logistics companies in the UK&I, where the EBITDA multiple is lower.
The average EBITDA multiple decreased until H1-2023 but is now resurging.
From H1-2021 to H1-2023, the average EBITDA multiple for the Automotive, Transportation & Logistics sector decreased, according to our half-year Monitor survey of hundreds of M&A professionals from key Western European countries.
The average EBITDA multiples for the Automotive, Transportation & Logistics sector in the Dealsuite core regions are equally weighted to calculate a European average.
IV Green Transformation in Transport and Logistics
The Transportation & Logistics sector is increasingly prioritising sustainability due to environmental concerns, regulatory pressures and consumer preferences. The sector is traditionally a major emitter of carbon. Now the sector is shifting towards greener technologies such as electric vehicles and renewable energy. Stricter governmental regulations and a rising demand for eco-friendly services are further accelerating this transformation. Sustainability has become a strategic necessity in M&A.
The European green deal and its impact on the sector
The European Commission has introduced a series of proposals aimed at aligning the EU’s climate, energy, transport, and taxation policies with the goal of cutting net greenhouse gas emissions by at least 55% by 2030, relative to 1990 levels. The energy transition is expected to require large investments in the long term. (European Commission, 2024)
It will be essential for boards and management to engage early and actively in substantial discussions regarding the impact of ESG-related legislation on corporate strategy. This includes exploring whether and how sell-side and/or buy-side M&A actions can effectively support the implementation of the ESG components of such strategies.
Environmental taxes on Transport:
Environmental taxes can be classified as taxes on energy, transport, pollution, or resources.
When pursuing mergers and acquisitions in the European transport sector, it is crucial to consider the impact of environmental transport taxes on returns. These taxes vary significantly across EU member states, affecting the overall cost structure and profitability of potential acquisitions. For example, environmental transport taxes account for as little as 0.04% of GDP in Estonia but rise to higher levels in countries like Greece (0.81%), Austria (0.83%), the Netherlands (0.87%), and Denmark (1.17%) (Eurostat, 2023).
Understanding these differences can help investors better evaluate the financial landscape and make informed decisions in their M&A strategies.
V 2024 opportunities
During the Covid-19 pandemic, the strategic importance of supply chain execution was highlighted. According to McKinsey, M&A was considered more to keep things moving. Despite a drop in transactions in 2023, 2024 offers new opportunities with leading investors ready to spend their amassed funds.
McKinsey has shared five priority areas for M&A investment in Transportation, Logistics and Infrastructure companies.
VI Dealmaker Insights
VII Method
For this sector monitor on the Transportation & Logistics sector, we consulted several sources, including:
These sources provided comprehensive insights and data for our analysis.
This research was conducted by Roos Bijvoet. For further questions, please contact Maarten Reinders, CCO Dealsuite.
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