Deutsche Post also holds a 25 cent stake in DHL.Deutsche Post has taken a "huge step" towards becoming a leading global supply-chain management provider with its move to buy AEI, says UK-based research and analysis organisation Datamonitor.
According to Datamonitor, the addition of AEI to the Deutsche Post/Danzas portfolio would now enable the German organisation to attract clients requiring supply-chain management services across the globe.
In fact, Deutsche Post's "aggressive expansion strategy" was putting it in a position to become one of the potential global supply-chain leaders of the future.
"The acquisition of AEI will allow Deutsche Post to jump headlong into the US logistics industry," the research company added.
"Combined with its European logistics clients, Danzas will be able to expand its logistics services on a worldwide scale allowing it to attract global clients requiring supply chain management services across the US, Europe, Latin America, the Middle East, Asia, Africa and the South Pacific."
AEI claims to be the oldest and largest international air freight forwarder in the US and a world leader in integrated logistics services.
It provides multimodal transportation, warehousing and distribution, customs brokerage and information management services across a network of 705 locations in more than 135 countries. With 7,700 employees worldwide, the company generated gross revenue of more than US$1.5 billion in 1998.
Under the terms of the merger, Deutsche Post will acquire AEI for $33 per share in cash.
AEI's board of directors and Deutsche Post's supervisory board have both approved the agreement although it is still subject to regulatory approval.
Meanwhile, the two parties have announced that the new CEO of Danzas-AEI will be Renato Chiavi who currently heads up intercontinental business at Danzas.
AEI's present CEO, Guenter Rohrmann, will assume the position of vice-chairman of Danzas-AEI and will be responsible for the integration.
Peter Wagner will be chairman of the combined company. AEI's present chairman, Hendrik Hartong, will join the Danzas board.
In the global logistics arena, claimed Datamonitor, Danzas would in fact now be in direct competition with AEI's industry peers such as Circle International and BAX Global.
News of the deal coincided with the publication of a Datamonitor report headed Global Logistics: Assessing the Potential for Global Supply Chain Management.
In that study, transport business analyst Samantha Lago concluded that "a continued level of consolidation through mergers and acquisitions will drive the future of global supply-chain management, as logistics providers become more capable of individually servicing their global clients' needs".
With the trend towards mergers between the larger global logistics companies showing no sign of decline, Datamonitor said the logistics industry would in the future be dominated by a small number of large global logistics and supply-chain managers.
"Among the most noticeable mergers in the US in recent years was the union between Federal Express and Caliber System. In Europe, many operators have also invested in global expansion in order to remain competitive in the current marketplace," the company said. "However, the union between Deutsche Post's Danzas and AEI is one of the first large-scale transatlantic acquisitions."
Many commentators and industry participants approached by Datamonitor said they believed the global logistics marketplace of the future would be dominated by five or 10 large players.
Those organisations, concluded the research company, could only come from acquisitions, mergers and alliances. Current names would not exist in five years time - new names would emerge as companies formed wider global organisations.
"This is evident now with examples like FDX Global Logistics, Schenker-BTL and P&O Nedlloyd but these are on a medium scale. The large organisations will require mergers and acquisitions between market leaders with a global coverage and the expansion strategy by Deutsche Post is positioning the company as one of the potential global supply chain leaders of the future."
Deutsche Post's Asia-Pacific headquarters in Singapore is seen as not only a boost to the island state's efforts to develop its logistics base, but also the opening salvo in the company's Asian ambitions.
Already the German giant is looking to expand into Hong Kong, Taiwan and Japan.
One major thrust of Deutsche Post regionally will be its direct marketing business and the company will in particular aim at the financial, mail order, publishing, tourism and manufacturing sectors.
It is hoping for revenue of up to $40m within three years. In particular the company reckons it can offer Asian companies a strong presence in Europe, and considers that its direct marketing skills would still be relevant in the age of the Internet.
In other news, DHL Worldwide Express will move its Asia Pacific hub from Manila to Hong Kong in March next year. As part of the move DHL has signed a partnership deal with Cathay Pacific. The deal will involve DHL utilising belly space on new overnight flight linking Hong Kong to Osaka, Seoul, Singapore and Taipei. Cathay also intends to tap into passenger demand for the 'red eye' flights typically departing at 2am and arriving at 6am.
From DHL's perspective the arrangement will allow for later cut-off times for shippers to despatch goods and an agreement which disbars FedEx and UPS booking space directly on the overnight CX flights.
DHL for its part still has the freedom to buy space directly on the overnight CX flights.
DHL for its part still has the freedom to buy space on other carriers operating on those and other Asian routes.
Continental Micronesia will re-deploy its 727 freighter, previously used to serve DHL's Asian overnight operations from Manila to Guam.
Philip Chen cheif operating officer for Cathay Pacific said that the additional capacity will generate an additional 912 tonnes of cargo. The new venture will also create 400 jobs in Hong Kong.
Charles Longley said that the move was prompted by the 24-hour operations at Chek Lap Kok and government plans to eliminate the transhipment licence required for cargo with a dwell time of more than 3 hours. DHL is also keen to extend the cut-off time for express products from China destined for other Asian destinations.