Advertisement

California and the West

German Firm May Bid for BAX Global of Irvine

November 10, 2005|From Reuters

Germany's national rail operator Deutsche Bahn is planning a $1.12-billion offer for Irvine-based logistics company BAX Global, with Bahn's supervisory board expected to vote on the bid Saturday, sources said.

"The supervisory board will be presented on Saturday with a bid in the amount of $1.12 billion," one source close to the negotiations told Reuters on Wednesday.

Another source said Deutsche Bahn was in exclusive talks to acquire BAX Global and could buy the business, a unit of U.S. security firm Brink's Co., if Bahn's supervisory board approved the deal by mid-November.

Shares of Richmond, Va.-based Brink's, which surged about 10% on Monday after Reuters reported that Deutsche Bahn was seeking to acquire BAX Global, opened little changed Wednesday and closed a penny higher at $46.27.

The stock has risen since the company's largest shareholder, New York-based hedge fund MMI Investments, suggested in April that a sale of BAX Global would improve Brink's share price and help pay off its legacy costs.

Buying BAX Global, which has about 12,000 employees and posted sales last year of $2.4 billion, would boost Deutsche Bahn's competitiveness in the U.S. and strengthen its logistics arm Schenker by adding air and sea transportation from the U.S. to Europe and Asia.

Heavy-freight specialist BAX Global arranges for the delivery of overnight and second-day freight from business to business in more than 130 countries.

It uses its own aircraft in North America and employs other carriers elsewhere. BAX also offers supply chain management services.

Members of Germany's ruling Social Democratic Party expressed skepticism about Bahn's bid as news of the plans emerged Monday.

"To invest so much out there in the United States, I have serious questions about that," transportation expert Uwe Beckmeyer said at the time.

But a Deutsche Bahn source said Chief Executive Hartmut Mehdorn had held a meeting last week on the BAX purchase with outgoing German Chancellor Gerhard Schroeder and Wolfgang Tiefensee, who is slated to become transportation minister in a new government.

Advertisement
Los Angeles Times Articles
|
|
|