DFDS Confirms Scandlines Bid

DFDS Confirms Scandlines Bid

DFDS confirmed today it has submitted a bid for Scandlines, the Danish-German ferry operator, which has been put up for sale by its private equity owners.

The Danish short sea shipping and logistics company reportedly is competing against two buyout firms, TPG Capital and Star Capital Partners.

DFDS said its “interest and participation [in the bid] is aligned with [its] strategy of expanding the route network through value creating acquisitions.”

Scandlines, which is co-owned by 3i of the United Kingdom and Germany’s Allianz Capital Partners, could fetch between 1 billion euros and 1.4 billion euros ($1.3 billion to $1.8 billion), with a sale expected to close by the summer.

A successful bid by DFDS would be its biggest acquisition since it acquired Norfolkline from Denmark’s A.P. Moller-Maersk in 2010 in a $425 million deal that left the parent of Maersk Line with a 31.4 percent stake in DFDS.

DFDS recently acquired three routes from France’s LD Lines, including a Mediterranean service, and a terminal in Sweden’s biggest port, Gothenburg.

While DFDS generates most of its revenues from cargo, Scandlines sold its freight business — which transports 800,000 trucks a year — and some ships and routes to Sweden’s Stena Line and Swedish Orient Line in the past year.

Private equity groups are attracted to short sea shipping in northern European waters because of fast growth forecasts driven mainly by rapidly expanding Baltic and Russian routes.

Nordic Capital last month agreed to buy Unifeeder, Europe’s largest independent short sea container feeder operator, from the UK’s Montagu Private Equity.

The Swedish private equity group is said to have paid around 400 million euros ($520 million) for Unifeeder, double what Montagu is thought to have invested when it backed a management buyout from the Danish company’s founders in 2007.