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Geodis parent buys IBM logistics operations

Geodis parent buys IBM logistics operations

French rail firm SNCF, the parent of global logistics provider Geodis, announced Tuesday that it has acquired IBM's internal global logistics operations in an all-cash deal for an undisclosed sum.

   The deal, handled through SNCF's transport and logistics division, also included a multi-year outsourcing contract that will see Geodis become the sole lead logistics provider for IBM. Under the contract, Geodis will manage about $1.25 billion per year of IBM's logistics costs supporting asset recovery services, service parts logistics and flow management of all hardware and software products worldwide.

   'This agreement is strategic to reinforce Geodis' position among the world leading logistics providers capable of delivering end to end solutions to its global clients,' said Jean-Louis Demeulenaere, Geodis deputy chief executive officer.

   'With this partnership, we will strengthen the skills and expertise required to service, both IBM's and our existing and future client's, core logistics needs in more than 120 countries. IBM's global logistics operations will significantly upgrade our services portfolio,' he said.

   Geodis said the acquisition and outsourcing contract are both part of an ongoing strategy to evolve the firm from 'a European multi-services company to a worldwide logistics provider.' The firm predicts the acquisition, which is expected to close in the first quarter 2009, to reinforce the Geodis network in the Americas as well as in expanding nations such as China, India and Russia.

   'All of the work that has been done by IBM to develop and integrate its supply chain across all of its businesses, provides us with an excellent opportunity to partner with a world class logistics company and leverage our joint resources on behalf of our many global clients,' said Gary S. Smith, vice president, global logistics, IBM Integrated Supply Chain.