By Liz Young and Paul Berger
France's CMA CGM, the world's third-largest container line by capacity, is acquiring FedEx Supply Chain for $1.4 billion in a deal that extends its reach into the growing market for third-party logistics services.
The deal announced Wednesday will add about 34 million square feet of warehouse space and 10,000 employees to CMA CGM subsidiary CEVA Logistics, expanding its footprint to more than 240 locations with 20,000 workers across North America.
After the deal closes, CMA and FedEx plan to enter into multiyear ocean and airfreight agreements worth an estimated $3.5 billion in business volume, according to a person familiar with the matter.
Marseille-based CMA has been on an acquisition spree since the Covid pandemic as it seeks to build up end-to-end supply-chain services for some of the world's largest retailers and manufacturers. The container line's billionaire chief executive, Rodolphe Saadé, last year told President Trump he would invest $20 billion in ships, seaports, warehousing and airfreight in the U.S.
The pandemic taught the world's largest ocean carriers the value of owning and operating nodes across the supply chain. The French liner is among carriers, including Denmark's A.P. Moller-Maersk, that have plowed billions of dollars in pandemic-era profits into acquiring terminals, warehouses and trucking and airfreight operations.
CMA CGM acquired CEVA Logistics in 2019 for $1.7 billion. It added a division of Ingram Micro focused on e-commerce and order fulfillment in 2022 for $3 billion and France's Bolloré Logistics, a large ocean and airfreight forwarder, in 2024 for about $5 billion.
Evan Armstrong, CEO of market research and consulting group Armstrong & Associates, said the acquisition of FedEx Supply Chain will bulk up CEVA's operations in North America. It also will add to its capabilities handling e-commerce, business-to-business contract warehousing and returns services.
The carrier has also bought terminals at the Port of Los Angeles and the Port of New York and New Jersey, two of the busiest ports on the U.S. West Coast and East Coast, respectively.
The combination of FedEx Supply Chain with CEVA Logistics would create the sixth-largest third-party logistics company by North American warehousing space, according to Armstrong & Associates.
More companies have turned their fulfillment operations over to third-party logistics providers, or 3PLs, since the pandemic, when widespread disruptions led to product shortages and shipping delays.
"If you're running your own warehouse with your own employees, you have risk for liability and other things, where if you use a 3PL to do the warehousing for you, you transfer the risk to the 3PL," Armstrong said.
CMA also said on Wednesday that it hired Patrick Moebel, formerly president of FedEx Logistics, a separate business division handling services such as freight forwarding, as the new CEO of CEVA.
FedEx Supply Chain was created out of FedEx's acquisition of Genco in 2015 for $1.4 billion.
Over the past several years FedEx has sought to refocus its business on deliveries of high-value goods including for the healthcare, automotive, data-center and aerospace industries. The company spun off its less-than-truckload carrier FedEx Freight into a stand-alone company last month.
The sale of FedEx Supply Chain is expected to close this year, subject to regulatory approvals. The companies said the air-cargo and ocean-freight agreements are expected to begin in different phases through 2028.
Write to Liz Young at liz.young@wsj.com and Paul Berger at paul.berger@wsj.com