French shipping group CMA CGM has agreed to acquire FedEx’s third-party logistics business for an enterprise value of $1.4 billion. The deal is expected to close later this year and will mean CMA CGM, through its CEVA Logistics subsidiary, will have around 150 warehouses and 20,000 employees in contract logistics in North America.

Expansion Plans

Following the acquisition, the companies also plan to develop partnerships under which CMA CGM will be the preferred ocean carrier for FedEx and they will collaborate on air cargo, CMA CGM said in a statement. CMA CGM last year announced plans to invest $20 billion in the United States over four years.

CMA CGM has also pursued diversification into logistics, port terminals and non-transport activities to offset volatility in ocean shipping. FedEx, in a bid to focus on its delivery business, spun off its trucking unit, FedEx Freight, earlier this month.

Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.