Kuehne+Nagel acquires Asian logistics provider Apex

Leading global law firm Baker McKenzie has advised global transport and logistics group Kuehne+Nagel on its acquisition of Apex International Corporation (Apex) from private equity firm MBK Partners and management, its largest acquisition to date.

Apex is one of Asia’s leading freight forwarders, especially in the transpacific and intra-Asia. The company was founded in China in 2001 and has expanded throughout Asia and beyond over the years of its growth history. With approximately 1,600 employees, Apex generates yearly turnover in excess of CHF 2.1 billion. In 2020, the company handled total air freight volume of approximately 750,000 tons and sea freight volume of 190,000 TEU.

Dr. Detlef Trefzger, CEO of Kuehne+Nagel International AG, says: “The combination of Apex and Kuehne+Nagel provides us with an opportunity to offer our customers a compelling proposition in the competitive Asian logistics industry, especially in e-commerce fulfilment, hi-tech and e-mobility. We are looking forward to welcoming the Apex colleagues to the Kuehne+Nagel family.”

The Baker McKenzie team was led by Alexander Fischer, together with Howard Wu, Alexander Blaeser, Matthias Trautmann, and with the following deal team members: Zurich: Boris Wenger, Matthias Courvoisier, Eva-Maria Strobel, Markus Wolf, Yves Mauchle, Roger Thomi, Zarina Fueglister, Tiziana Hongler and Jan Lusti; PRC: Zheng Lu, Terry Xu, Gege Li, Merry Du, Coco Xi, Emma Zhao, Leo Zhang, Sufi Shang, Luis Zhang, Rachel Ye, Cora Wu, Lucca Li, Xi Chen, Hunt Wu, Kevin Yuan and Laura Liu; Hong Kong: Harold Van Kooten, Isabella Liu, Jannice Lau, Joel Cheung, Mandy Hung, Bryan Ng, Stephen Crosswell, Charlie Wong, Thomas Jenkins, Amy Ling, Lu Zhou, Jannie Mak, Rainbow Fu, Lesley Jingyu Luo and Antonia Chan; USA: Eunkyung Shin, Jeanne Song, Andrew Sagor, Chen Tang, Derek Liu, Stuart Seidel, John Fedele, Jennifer Trock, Alexander Matthews and Arvind Miriyala; Australia: Eric Thianpiriya; Canada: Yana Ermak; Germany: Alexander Ehrle; Mexico: Reynaldo Vizcarra-Mendez and Jesus Antonio Perez-Palazuelos; Netherlands: Christiaan Van der Meer, Danielle Pinedo, Florian Fehres, Emile Doelwijt, Julie Wulfften Palthe, Maarten van Laar, Philip Luckmann and Anastasia Moonen-Vaes; Taiwan: Gwyneth Gu and Yiting Lin; Thailand: Pornapa Luengwattanakit, Narumol Chinawong Teo, Sirikan Buranasiri and Kritchaya Rattanasakul; Vietnam: Lan Phuong Nguyen, Chi Hoang Yen Ngo and Xuan Nghi Ma.

The acquisition is subject to customary closing conditions, including merger clearance by the competent competition authorities. The purchase price will be financed by available liquid sources and, if needed, by available credit lines. Following closing of the transaction, a minor stake of Apex shares is to remain with the experienced and entrepreneurial management of Apex.

New measures in Brazilian Public Ports

Provisional Measure No. 945/2020 was issued by the Brazilian Federal Government, which deals with temporary measures in response to the pandemic resulting from the Covid-19 in the scope of the port sector and on the assignment of yards under military administration.

This Provisional Measure, according to the Federal Government, aims to ensure a safer environment for dockworkers, in addition to recognising the essentiality of Port Operations.

The Executive Order from April 4, changes the Daily call for casual dockworkers, who carry out loading and unloading operations in Brazilian Public Ports.

Currently, these workers are called to engage amidst large agglomerations in the ports, which in times of pandemic is not recommended. The Provisional Measure establishes that the Manpower Management Agencies (OGMO) must carry out the call for casual dockwers by eletronical means only, so that the worker appears at the port only at the time needed and in order to avoid further agglomerations within port area.

The Provisional Measure provides that the Manpower Management Agencies will not be able to call or engage in operation any dockworker who:

  • a) present symptoms compatible with covid-19 (i. dry cough; ii. sore throat; iii. breathing difficulty);
  • b) have been diagnosed with covid-19;
  • c) who are pregnant or lactating;
  • d) aged 60 or over; and
  • e) who have immunodeficiency or respiratory diseases or chronic or severe pre-existing diseases.

In this context, the Provisional Measure assures workers in the above situations the right to receive a monthly compensatory indemnity of 50% of the monthly income average received between October 1, 2019 and March 31, 2020, as long as impediment persists.

It is worth mentioning that casual dockworkers, retired or enjoying any other benefit granted by the General Social Security Regime or their own social security regime, as well as those who perceive the assistance benefit for individual dockworkers, provided for in Law No. 9,719 of November 27, 1998, will not be entitled to the indemnity provided for in the Provisional Measure.

The payment of compensatory indemnities will be borne by Port Operators and will be calculated in proportion to the amount of the monthly service demanded.

The aforementioned amount will be calculated and collected by the Manpower Management Authority and later passed on to the casual dockworkers.

Port Operators will be entitled to a discount on port tariffs in the amount equivalent to the increase in cost, resulting from the payment of indemnity, or economic and financial re-balancing of their contracts, in cases where they have lease agreements with the public port.

In the Provisional Measure, it was also adjusted that the benefit to be paid to dockworkers may be excluded from net income for purposes of determining corporate income tax and Social Contribution on Net Income of legal entities taxed by taxable income.

The Provisional Measure establishes that in the event of unavailability of casual dockwers to meet the work demand, Port Operators may freely hire workers with an employment contract for a specified time to carry out services as foreman, block, stowage, cargo conference services, cargo repair and vessel surveillance.

The hiring of workers with an employment relationship based on unavailability cannot exceed the period of 12 months. In addition, it will possible to engage contract directly with workers that or not authorised or registred with the Manpower Management Authority (OGMO).

Said Provisional Measure, guarantees Port Operators flexibility in the exclusivity of hiring labour from the Manpower Management Authority (OGMO) system.

It is worth mentioning that the new rule issued by the Federal Government, considered unavailability of port workers as any cause that results in the immediate non-fulfilment of calls submitted by Port Operators to OGMO, such as strikes, shutdown movements and standard operation.

Finally, the Provisional Measure encourages multi-functionality, to ensure that port operations are not suspended or delayed due to a lack of qualified labour.

Thus, regardless of collective bargaining, new registration or past registration casual dockworkers may perform the activities of any of the categories (foreman, stowage, cargo checking, cargo repair, vessel surveillance, block), provided they have the necessary qualification for that purpose.