CMA CGM acquires FedEx Supply Chain unit

Marseille, France-based shipping mammoth, CMA CGM has announced to buy FedEx’s third-party logistics business for USD 1.4 billion in cash. FedEx Supply Chain manages warehousing, distribution, fulfillment services and transportation solutions for clients. CMA CGM plans to integrate the FedEx unit into CEVA Logistics, its logistics arm. Once accomplished, CEVA would nearly triple its size in North America. FedEx Supply Chain employees are expected to start wearing CEVA workwear soon – courtesy of FedEx. FedEx Supply Chain is a logistics heavyweight. It runs more than 130 distribution centers covering over 40 million square feet of managed space, with two-day fulfillment reach to 96% of the U.S. population. Its services span reverse logistics, transportation management, customs brokerage, warehousing and contract manufacturing; capabilities that will now be run by CEVA, a leading global supply chain solutions provider and a unit of the world’s third largest container shipping group. Major investments on the horizon CMA CGM has recently diversified its business well beyond ocean shipping, building out positions in logistics services, port infrastructure, air freight, and media. At a White House event last year, CEO Rodolphe Saadé announced a commitment to channel USD 20 billion into American maritime infrastructure, logistics networks, and terminal development over a four-year period. Hence, the FedEx deal is in line with CMA CGM’s strategic plans and Saad’s drive to transform the privately owned French box carrier from a pure-play ocean shipping company into a diversified logistics group. Focusing on parcel delivery activities From FedEx’s perspective the deal documents its efforts to concentrate on its core package delivery services. To sharpen that focus, FedEx has merged its ground and air delivery networks and pursued an aggressive cost-reduction program. On 01JUN26, the company completed the separation of its trucking division, FedEx Freight, listing it as a standalone publicly traded company. FedEx Freight paid a cash dividend of approximately USD 4.1 billion back to FedEx Corporation, Reuters reports. Alongside the acquisition, the Financial Times, citing people familiar with the matter, reported that the two companies are expected to announce freight-forwarding partnerships that would pair FedEx’s air cargo network with CMA CGM’s container shipping scale. The relationship will be deepened However, the collaboration between the two companies seems to be going much further. There are strong indications that CMA CGM and FedEx are about to finalize negotiations on a multi-year commercial arrangement aimed at joining forces in air and ocean freight matters, with the French box liner becoming FedEx’s preferred ocean carrier. The companies will also work together on special air cargo capacity solutions to enhance their respective global networks in the interest of higher aircraft utilization and flexible long-haul capacity. It remains to be seen whether the intensifying business relationship between the Franco-U.S. duo will also have an impact on CMA CGM Air Cargo, the shipping line’s air freight subsidiary. Its main base is Charles de Gaulle Airport (CDG). Incidentally; CDG is also FedEx Express’ busiest European hub and the company’s second largest worldwide, after Memphis, Tennessee.