ACR Integration
Increased Capability to offer Integrated Services 4.7% Ranking of contract logistics providers 2.5% 1.1% 1.0% 0.7% 0.7% 0.6% 0.6% 0.6% 0.4% 0.4% Exel/DPWN TNT Kuehne + Nagel pro-forma Wincanton Fiege ACR Schenker Ryder UPS Kuehne + Nagel Salvesen Chr. - Mid-term target of CHF3bn revenues in contract logistics achieved - Combined entity becomes a TOP 3 player in contract logistics and one of the leading providers of integrated logistics services globally Kuehne + Nagel Investors Day 2007 27/04/07 p. 2
Coverage of all Major European Markets ACR Country Staff UK & Ireland 6 748 France 4 047 Benelux 2 008 Italy 670 Other 2 222 15 695 Significant presence of ACR Significant presence of Kuehne + Nagel ( ) - ACR has a strong presence in the UK, France, Italy and the Benelux countries - No significant overlap with Kuehne + Nagel s operations in Europe - Combined group has a strong presence in all major European contract logistics markets Kuehne + Nagel Investors Day 2007 27/04/07 p. 3
Concept on ACR Integration Integration of this complementary acquisition covering in 11 countries with app 15 000 staff based on one company per country concept with one management structure One brand name A dedicated migration team, as part of Corporate Finance, was created for the legal / tax / finance integration Upon completion (1-1-2006) the final management structure per country was agreed, communicated and put in place By the end of Q1 2007 the back office incl. standardising of finance application finalized Kuehne + Nagel Investors Day 2007 27/04/07 p. 4
Overview United Kingdom Kuehne + Nagel announced intention to acquire ACR on 17 October 2005 Kuehne + Nagel has existing leading position in Sea & Air in UK Top 10 player in Rail & Road Almost no presence in ACR was top 5 player in UK Limited activities in Rail & Road No presence in Sea & Air Kuehne + Nagel Investors Day 2007 27/04/07 p. 5
Integration timeline Kuehne + Nagel completed acquisition January 2006 Internal and external communication commenced New management structure implemented on 1 March 2006 (2 months) ACR renamed Kuehne + Nagel Ltd. on 1 March 2006 Business field integration completed by 31 March 2006 (3 months) Back office integration finalised before year end 2006 Legal entities merged effective 1 January 2007 Kuehne + Nagel Investors Day 2007 27/04/07 p. 6
UK Situation 2005 Managing Director Airfreight Seafreight Rail & Road Sales Finance Human Resources IT Business Fields Functional Units Managing Director Sales Finance Human Resources IT Business Fields Functional Units Kuehne + Nagel Investors Day 2007 27/04/07 p. 7
UK Situation 2006 Managing Director Managing Rail & Director Airfreight Seafreight Sales Finance Road Human Resources IT Sales Business Fields Functional Units Kuehne + Nagel Investors Day 2007 27/04/07 p. 8
Managing Director Rail & Airfreight Seafreight Sales Finance Road Human Resources IT Business Fields Functional Units Global Kuehne + Nagel management structure implemented Kuehne + Nagel Investors Day 2007 27/04/07 p. 9
Terms & Conditions Basic principles Harmonisation of all Terms & Conditions Value of compensation packages remain unchanged Equal benefit structure across combined company Top down implementation Central procurement Harmonisation to be cost neutral Kuehne + Nagel Investors Day 2007 27/04/07 p. 10
Harmonisation of Terms & Conditions Harmonisation project commenced 1 March 2006 Management contracts changed to global Kuehne + Nagel standards as of 1 July 2006 All other employee agreements changed as of 1 January 2007 Discontinued benefits exchanged for new benefits or higher salary New additional benefits available against salary sacrifice Pension plans and insurance consolidated Joint payroll and HR system One Company - One Concept Kuehne + Nagel Investors Day 2007 27/04/07 p. 11
Kuehne + Nagel UK & Ireland Expanded New Network 88 locations 650,000 sqm 9400 staff Kuehne + Nagel ACR KN Drinks Kuehne + Nagel Investors Day 2007 27/04/07 p. 12
Post Integration Review Integration of ACR UK completed ahead of schedule Stable management platform Gained No. 3 position in UK contract logistics market 140 million of new contract logistics business secured Sea & Air continued to grow at twice the market rate Already one third of the combined top 25 customers are engaging with Kuehne + Nagel across business units Kuehne + Nagel Investors Day 2007 27/04/07 p. 13