Maersk to acquire Swedish customs broker KGH Customs Services

July 6, 2020: A.P. Moller - Maersk announced that it has reached an agreement with Bridgepoint Development Capital to acquire KGH Customs Services (KGH), a Sweden-based specialist in trade and customs management services in Europe, to improve its capabilities as an integrated container logistics company with end-to-end supply chain solutions.

Maersk will acquire KGH for a consideration of $279.0 million on a cash and debt-free basis equivalent to a multiple of 16.3x 2019 EBITDA before synergies, excluding an earn-out component contingent on future Brexit performance. When ramped up, annual EBITDA synergies from the combination are expected to amount to approximately $5.4 - $8.0 million.

Maersk & customs clearances
“With its specialised expertise across freight modes (air, ocean, land) and deep knowledge in selected industries, combined with innovative technology, KGH will significantly improve Maersk’s overall offering within customs services. KGH has a strategy focused on digital solutions and technology as an enabler for a more seamless customer experience, which also corresponds with Maersk’s own digital transformation journey,” said the release.

The acquisition of KGH makes Maersk an attractive partner for its customers operating in individual countries, as well as for those looking to combine several geographies under one service provider. With the acquisition of KGH, Maersk will have a solid platform for growth in customs services in Europe with own setups operating in 22 European countries with a total of 2.38 million clearances on a yearly basis, 960 specialised employees and a combined turnover of $109.4 million.

Total customs expertise with one acquisition
Vincent Clerc, CEO, ocean & logistics, A.P. Moller – Maersk, said “There are no end-to-end solutions without customs clearance. With KGH, we will not only be able to strengthen our capabilities within customs services and related consultancy, but also reach more of our customers in Europe through a larger geographical footprint and digital solutions that will enhance our ability to meet our customers´ end-to-end supply chain needs. We achieve all this in one go instead of having to build our expertise through multiple acquisitions.

KGH Customs Services
Based in Gothenburg, Sweden, KGH is a partner to a wide range of authorities, providing consulting and advice, most recently in the connection with Brexit, as advisors to various authorities in the EU and the UK. KGH has in the past years achieved double-digit annual growth resulting in a revenue of approximately $95.5million in 2019, recurring EBITDA of approximately $17.2 million and an EBITDA margin of approximately 18 percent. KGH has 775 employees and a yearly business of 1.98million clearances.

Lars Börjesson, CEO of KGH Customs Services, said “With Maersk, we will have a long-term home with a company that share our values. By joining forces, we will be able to continue to build on the great success our teams have achieved, and at the same time play a key role in a combined entity providing a range of different services within the transportation and logistics industry. Customs services are an essential part of our customers’ end-to-end needs which we in unison with Maersk will be able to provide with seamlessness and global reach.”

The closing of the acquisition is subject to customary regulatory approvals. Until then, Maersk and KGH remain two separate companies and thus will do their business as usual.