One of the largest and longest-running shipping companies in the world is about to get a whole lot bigger with the recent acquisition of an omnichannel fulfillment organization.

Maersk, otherwise known as A.P. Moller Maersk A/S, is joining forces with LF Logistics Holding Limited, the Danish shipping supplier and provider announced in a company press release. Headquartered in Hong Kong, LF Logistics is a privately held business that specializes in providing contract logistics to customers primarily in the Asia-Pacific region and is a subsidiary of Li & Fung. Partnered with Li & Fung, the goal is for Maersk to expand its logistics solutions capabilities for more global, end-to-end supply chain capabilities that customers can leverage.

Spencer Fung, who serves as group executive chairperson at Li & Fung, noted that the pairing is a watershed moment for both organizations and will help to make supply chain optimization a reality for other businesses in various industries.

"With Li & Fung's upstream digital and sourcing expertise and Maersk's downstream logistics capabilities, we will begin to offer our respective customers the opportunity to take advantage of this unique end-to-end value chain proposition anchored upon operations excellence, technology, and sustainability," Fung explained.

$3.5 billion deal not yet final
The deal is reportedly worth over $3.5 billion (all cash) and will make Maersk the 100% stakeholder in LF Logistics. However, once the deal becomes official — slated to occur in 2022 upon regulatory approval — Li & Fung will reacquire LF Logistics, but only its global freight management division. Maersk may change its company name, but until then, it will remain Maersk and LF Logistics will continue to operate on its own.

Vincent Clerc, chief executive officer of ocean and logistics at Maersk, said he is eager for the deal to be finalized.

"We are excited, and we look forward to strengthening our global logistics business and welcoming 10,000 new logistics experts from a customer-centric culture with well-executed operations," Clerc said in a statement. " With the intended acquisition of LF Logistics, we will bring in an extensive warehousing network covering the fast-growing Asia-Pacific markets; all underpinned by a best-in-class operational and technology platform which we can scale globally across our network."

Maersk to become 7th largest logistics provider
From a sheer dollar perspective, it's among the biggest that Maersk has made in its storied history. But it's also stretching its physical footprint, which is expansive as it is. Indeed, Makersk is poised to become the seventh largest contract logistics provider in the world by acquiring 10,000 employees who work for LF Logistics and its 223 warehouses in more than a dozen countries, Supply Chain Dive reported. At present, Maersk Group has 76,000 employees in 130 nations. The acquisition makes for newly charted territory for Maersk.

M&As have been business as usual for Maersk Group. In 2019, it acquired customs broker Vandegrift and in 2020, Maersk purchased Performance Team and KGH Customs Services for $545 million and $281 million, respectively.

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