Performance Team Acquisition: Key Details, Impact, and What Comes Next

Maersk's acquisition of Performance Team, a leading US-based warehousing and distribution company, marks a significant step in enhancing its logistics capabilities. This strategic move, valued at $545 million, positions Maersk as a key player in North America's warehousing sector, expanding its footprint to 46 sites and bolstering its end-to-end supply chain solutions.

What Is Performance Team?

Founded in 1987, Performance Team specializes in warehousing and distribution, transportation management, and warehouse management. The company stands out in the market by emphasizing the importance of its employees, offering comprehensive benefits packages, and providing flexibility, development, and on-the-job training. As part of A.P. Moller-Maersk, Performance Team leverages the resources and credibility of a global logistics leader to deliver exceptional supply chain solutions.

Who Acquired Performance Team?

Maersk is a leading integrated logistics company specializing in container logistics and supply chain services. It offers a range of digital solutions for booking, managing, and tracking shipments online, alongside comprehensive end-to-end supply chain management. The company provides tailored logistics solutions for various industries, including FMCG, retail, fashion, chemicals, perishables, automotive, pharma, and technology. Maersk's market position underscores its influence and commitment to innovation in the global logistics sector.

When Was Performance Team Acquired?

Maersk completed the acquisition of Performance Team on April 1, 2020. This strategic move came at a time when the logistics industry was grappling with the challenges posed by the COVID-19 pandemic. The acquisition aligns with Maersk's strategy to enhance its end-to-end supply chain capabilities and capitalize on the growing e-commerce market. By expanding its warehousing footprint in North America, Maersk aims to better manage supply chains and improve competitiveness during uncertain times.

Why Was Performance Team Acquired?

• Market Expansion: The acquisition of Performance Team significantly increases Maersk's warehousing footprint in North America, growing from 22 to 46 locations. This expansion enhances Maersk's ability to offer comprehensive end-to-end supply chain solutions, particularly targeting the rapidly growing e-commerce sector.
• Technology Integration: Performance Team's expertise in omnichannel fulfillment, e-commerce, and inland transportation will be integrated into Maersk's existing network. This integration aims to create a customized hold and flow model, enhancing supply chain flexibility and providing more options for Maersk's customers.
• Competitive Advantage: The acquisition strengthens Maersk's position as an integrated container logistics company by expanding its warehousing and distribution capabilities. This move allows Maersk to better serve its customers' end-to-end supply chain needs and capitalize on the growing e-commerce market, which is expanding at a rate of 12% annually.

Acquisition Terms

• Acquisition Price: The transaction was valued at $545 million, including IFRS 16 lease liabilities of around $225 million.
• Payment Method: The specific payment method was not publicly disclosed.
• Key Conditions or Agreements:
  • Performance Team’s CEO, Craig Kaplan, will remain in his position post-acquisition.
  • The acquisition is subject to regulatory approvals and was expected to close on April 1, 2020.
  • The deal aims to integrate Performance Team’s omnichannel fulfillment services into Maersk’s supply chain solutions.
  • The acquisition will expand Maersk's North American warehouses from 22 to 46 locations.

Impact on Performance Team

The acquisition of Performance Team by Maersk has led to significant operational changes, including the integration of Performance Team’s warehousing and distribution capabilities into Maersk’s existing network. This expansion has increased the number of North American warehouses from 22 to 46, enhancing Maersk's ability to offer comprehensive logistics solutions. Craig Kaplan remains the CEO of Performance Team, ensuring continuity in leadership and a smooth transition. The combined entity now offers a broader range of services, including e-commerce fulfillment, transload, consolidation, and inland drayage, providing more options for customers.

Product offerings have also seen a notable enhancement. Performance Team’s expertise in omnichannel fulfillment and e-commerce is now available to a wider customer base, strengthening Maersk’s end-to-end supply chain solutions. Employee reactions have been positive, with Kaplan expressing excitement about the growth opportunities for both customers and staff. Customer feedback has highlighted the added flexibility and improved supply chain management options. For founders considering business transitions, tools like Sunset can assist in managing such processes compliantly, ensuring a seamless and efficient transition.