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Maersk announced its plans to acquire Pilot Freight Services (Pilot), adding big and bulky first, middle and last mile logistics to its landside transportation offerings in a transaction worth US$1.68 billion.
Pilot is a US-based first, middle and last mile as well as border crossing solutions provider, specializing in the big and bulky freight segment in North America for B2C and B2B distribution models.
"With the intended acquisition of Pilot, Maersk will extend its integrated logistics offering deeper into the supply chain of its customers," the shipping line said in a statement. "It will complement the earlier acquisitions already made to provide integrated logistics solutions in North America, especially with Performance Team (PT) (B2B warehousing and distribution) and Visible SCM (e-commerce warehousing and parcel distribution)."
Maersk noted that Pilot will be adding specific new services within the fast growing big and bulky e-commerce segment, thus increasing cross-selling opportunities. It will also create significant cost synergies by leveraging capabilities across the different parts of service solutions.
"In Maersk we continue our path to develop truly integrated logistics offering for our customers, offering them better visibility, more control and resilience in their supply chains," said Vincent Clerc, CEO of Ocean & Logistics, A.P. Moller - Maersk.
"Adding the capabilities of Pilot is especially important because it will allow us to create more exciting solutions for our customers and support them through the acceleration of the migration towards e-commerce," he added, noting that it will also "open significant cost synergy opportunities" by leveraging the capabilities we have already developed in the network.
Expansion of transport for big, bulky items
Maersk noted that throughout the unfolding of the pandemic, macro trends in the supply chain have "accelerated," such as the increased shift towards e-commerce, especially for big and bulky items.
"This important shift will continue and necessitate the creation of new distribution networks and solutions to support companies adapting their supply chains to these new consumer demands," Maersk said.
It added that the transition goes for numerous B2C vertical segments such as retail, home furnishings and consumer electronics as well as B2B segments such as aerospace, automotive and healthcare.
Pilot operates a North American facilities-based transportation network of 87 stations and hubs through which freight is transported and distributed to end customers.
The company uses mainly 3rd party providers of trucking and has access to controlled capacity which facilitates a high quality first, middle and last mile service offering. The scope encompasses full truckload (FTL) and less-than-truckload (LTL) for both B2C and B2B distribution including heavy and bulky shipments with white glove service with a focus on expedited and time definite services.
Boost to end-to-end capabilities
Maersk said the combined Pilot and Maersk scale will offer customers approximately 150 facilities in the US, including distribution centers, hubs and stations.
"This landside logistics network depth combined with Maersk’s international presence will create tremendous new, end-to-end supply chain performance capabilities," the container line added.
Narin Phol, regional managing director at Maersk North America, said this acquisition will add "even more expertise" and supply chain capacity to customers facing capacity constraints and multiple handoffs with providers in the B2C and B2B space.
"By investing in first mile, middle mile and last middle and integrating them we meet a clear customer demand," Phol added.
The acquisition is subject to regulatory review and approval which is expected to be obtained by the second quarter of 2022.
Maersk said both companies will operate as independent businesses and run their operations as usual until that time.
