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21 June 2017

Lineage Logistics Goes International with Acquisition of European Cold Storage Provider

US-based warehousing, logistics, and cold storage firm Lineage Logistics have gone from strength-to-strength over recent years, expanding into new markets and cementing their position in existing ones by offering an extensive range of services and facilities to their growing portfolio of clients. Europe has however remained an elusive beast to the company; that is until they recently announced their acquisition of European cold storage provider Partner Logistics.

The acquisition provides Lineage Logistics with an additional 101m cubic ft of capacity in temperature-controlled facilities throughout the Netherlands, Belgium, and the UK. This will facilitate the storage of approximately 500,000 pallets across six automated warehouses and one conventional facility.

The deal is in truth less about the extra space and more about Lineage continuing their push to embrace automation throughout their cold storage facilities. Their strategy in this regard is already well underway and split across a three-year timespan.

Greg Lehmkuhl, president and chief executive of Lineage Logistics, said of the deal, “Our acquisition of Partner Logistics represents Lineage’s ongoing commitment to serving our customers’ global supply chains by delivering dynamic, sophisticated cold chain logistics solutions.

“We are thrilled to welcome the Partner team and are confident their incredible industry expertise, particularly in automation, will accelerate Lineage in this area.”

Adam Forste, managing partner of the investment firm Bay Grove which is backing Lineage in the acquisition, commented that the deal tied into Lineage’s goal to become the “most-dynamic” of temperature-controlled logistics companies. He continued by stating, “This expansion into Europe is a significant milestone in achieving that goal.

“And the transaction also highlights our commitment to automation as a critical pillar of our growth strategy globally.”

The deal, coupled with Lineage’s strong performance as of late, led to ratings agency Moody’s upgrading the company’s investment rating from negative to stable in March of this year. The ratings agency further commented with a hint of caution, “Lineage’s aggressive growth-oriented strategy, which involves significant investments [is] well beyond the bounds of internally generated funds [and] continues to result in an adequate liquidity profile characterised by negative-free cash flow and a reliance on external sources of financing.

“Lineage’s ongoing efforts to improve operational efficiency and execution, along with a greater focus on pricing and new business wins, have yielded positive results over the last few quarters. The company’s ability to sustain this momentum while reducing leverage and moving towards an improved liquidity profile will be important.”

Sam Bonson

Sam is an aspiring novelist with a passion for fantasy and crime thrillers. He is currently working as a content writer, journalist & editor in an attempt to expand his horizons.