Source: Reuters, 2021-06-23
Auto transport firm Gefco has been put up for sale by owners Russian Railways (RZhD) and carmaker Stellantis in a deal expected to be worth more than €2bn ($2.39bn), people close to the matter said.
The owners are working with JP Morgan and Rothschild on the divestiture, they said, adding potential buyers have already been asked to log their interest.
Gefco, its owners and the banks declined to comment.
Gefco is expected to post earnings before interest, taxation, depreciation and amortisation of €345m on sales of €4.4bn in 2021, one of the sources said.
In 2020, factory and dealership closures and delayed purchases by consumers due to the pandemic led to a 20% slide in turnover to €3.8bn, while recurring EBIT fell 32% to 140m.
Car markets have since rebounded and European car registrations surged 74% in May, rising for the third month in row.
Stellantis remains Gefco's main customer, accounting for roughly half of its revenue, and has already flagged that it will reduce its business with Gefco, weighing on the company's valuation, the people said.
While many listed logistics peers trade at more than 10 times their expected core earnings, Gefco is expected to be valued at significantly less than 10 times, one of the sources said.
France's PSA Peugeot Citroën sold a 75% stake in Gefco to Russian Railways in 2012 for €800m. PSA Peugeot Citroën rebranded as Stellantis in 2020 after its merger with FCA.
Founded in 1949, Gefco employs 11.500 staff in 47 countries. It tried to float on Euronext in 2019, but had to scrap plans on muted investor interest.
The company sells transport services to Stellantis, Ford, Renault, Skoda and Toyota, but also other companies such as Nestle and Electrolux.
In September 2020, a global cyberattack on Gefco made headlines and Gefco said in its annual report published in May 2021 that it made significant progress in rolling out a new IT system.
Stellantis Chief Executive Carlos Tavares has said he would present a business plan for Stellantis in late 2021 or early 2022, as he is working to deliver on a synergy target of more than €5bn a year.
Stellantis in June 2021 floated French used car group Aramis.
Russian Railways, initially planned to expand its logistics business after buying Gefco, but a few years later changed course, selling Russian railway logistics container operator Transcontainer.