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Top 4 forwarders that may be ripe for M&A activity in 2018

Although mergers and acquisitions (M&A) in the 3PL community so far in 2017 were not quite as numerous as they were in 2016, many airfreight industry analysts say the current boom times for air cargo should make 2018 another banner year for consolidation in the still fragmented freight forwarding business.

Just two months ago the highly anticipated mashup of CEVA Logistics and Geodis fell through after the French railway group, SCNF, which owns Geodis, said it was undergoing a major reorganization and had ended negotiations for the merger. However, in early September, U.S.-based 3PL C.H. Robinson successfully took over Canadian forwarder Milgram & Co. in a move to bulk up its surface network and customs brokerage capabilities. Also, recent successful mergers, such as XPO Logistics/Con-way, GEODIS/OHL and DSV/UTi, have proven to give logistics firms larger networks and greater market share.

Momentum for M&A in the forwarding space is only expected to build in the coming year, according to a report from British consulting firm Transportation Intelligence, which said the top 10 forwarding firms accounted for 43.5 percent of the industries US$141 billion global revenue in 2016, adding that there was still more room for consolidation.