M&A in the Italian transportation and forwarding market will continue to occur. If one looks at the changing patterns in the fashion industry which is very important for Italy it is clear that the transportation and forwarding market will adapt to this. M&A is an alternative for larger buyers to improve its position an create synergies. In 2011 the Italian road & rail transportation market grew by 6.5% to reach a value of $60 billion. The industry is forecast to have a value of $85 billion in 2016, an increase of 42.3% since 2011. Italy accounts for 12.7% of the European road & rail transportation market value. France is leader of the European market with 16.1%, Germany is second with 15%.
We see sales of transportation companies in the German market due to retirement and expect further consolidation and hence M&A activity over the next years. Although the larger transportation companies have already acquired a significant number of privately owned companies we think further M&A will occur. Being able to deliver road transportation at low prices is crucial and hence scale (and cheap financing possibilities) is an important driver to compete. The German road & rail industry shrank by 1.3% in 2011 to reach a value of $71 billion although the volume grew by 2.7%. Forecast for 2016 shows an increase of the value to $80 billion, which means the compound annual growth rate of the industry in the period 2011–16 is predicted to be 2.6%.
We do expect quite some consolidation and hence M&A activity to see in the Spanish transportation market over the next years. Being able to deliver road transportation at low prices is crucial and hence scale (and cheap financing possibilities) is an important driver to compete. In 2011 the Spanish road and rail market reached a value of $34 billion. In 2016 the rail & road industry is forecast to have a value of $52 billion, an increase of 53% since 2011. The market in Spain accounts for 7,3% of the European market value. During the growth of the Spanish transportation market we think large buyers will grow their market share organically and via M&A activity.
Erki Katkosild, Investment Agency OÜ analyst