Since the first rumors of DB Schenker’s sale, DSV shares have been on a steady upward trajectory. Last week, DSV’s stock climbed by 12%, and although it dipped by 1.2% on Monday to 1,351.5 Danish kroner, it rebounded the following day.
The acquisition of DB Schenker marks a pivotal moment for DSV. On September 12, the Danish company completed the purchase of its German competitor, becoming the largest freight forwarding company in the world.
As a result of the transaction, DSV will now employ 147,000 people across more than 90 countries and generate annual revenues of EUR 40 billion—14 times DB Schenker’s operating profit over the past 12 months.
According to The Economic Times, DB Schenker would have struggled to achieve such a high valuation as a public company. The German firm’s operating margins are only 5.9%, half that of DSV. However, the Danes are confident they can raise these margins to match their own.
Analysts from UBS Group AG, a Swiss financial firm specializing in corporate asset management, estimate that DSV could achieve up to EUR 1.6 billion in additional operating profit from the acquisition. “If this goal is met, the post-tax return on investment could be nearly 10%,” adds The Economic Times.