September 16, 2024 09:51 GMT
DSV (DSVDC; A3/A-; S) Moody's comments on €14.3b Schenker acquisition
TRANSPORTATION
Moody's has confirmed ratings will stay unch for now through what it sees as €6-7b in debt - it will move Moody's adj. leverage from 1.8x to >3x. Despite M&A experience it notes same execution risks we did on Friday;
- DSV running near twice Schenker's (5.5%) operating margins over the last year leaves large gap to close
- The 2yr commitment made to Schenker German employees may be drag on above
Our assumptions unch; pro-forma net 3x, no rating changes in immediate future, €5-6.5b in supply across TL and €bonds.
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