First surprise – there appeared to be more logical candidates
The names of CVC Capital and Emma Capital only popped up as potential buyers late in the day. Instead, Czech investment group PPF and GLS (in which Daniel Křetínský is a major shareholder) were seen as the main candidates to buy Packeta. The former is a large shareholder in InPost (21.7%), and the latter has a highly complementary European network, which could do with an “out of home” boost in CEE.
Just days before the deadline for binding offers, The Times newspaper reported that IDS was considering entering an offer of €500m (US$550m) itself.
Second surprise – the value of the deal
Although details of the winning offer have not been disclosed, Czech e15 Magazine refers to a value of less than Kč10bn (US$446m). In view of the aforementioned €500m (US$550m) mentioned in The Times, this would be a second surprise.
In August 2023, one of Packeta’s founders said in an interview with Hungarian financial paper Hospodarske Noviny that his company was expecting revenue for the financial year of 2023 to reach Kč7.5bn (US$334m). If the company has delivered on this guidance, then the winning offer would value Packeta at approx. 1.3 times sales – well below InPost’s current valuation of approximately 3.5 times this. Part of this could be due to InPost’ remarkable earnings before interest, taxes, depreciation and amortization (EBITDA) results in its core market, something Packeta can currently only dream of.
Part of a bigger deal…?
CVC Capital has gained experience in the mail and parcels markets as a former shareholder in Danish Post (Post Danmark) and Belgium’s bpost. Today’s investments include a Polish convenience store chain Żabka, with over 10,000 outlets in Poland (which also serve as PUDOs for multiple carriers, including Poczta Polska, DPD and DHL) and a recently acquired fast-moving consumer goods (FMCG) distributor in Romania.
In addition, CVC Capital owns an undisclosed stake in Skroutz, Greece’s leading e-commerce platform, connecting six million online shoppers with more than 4,500 merchants, offering over 10 million products.
Emma Capital has several e-commerce investments as well, including: Mailstep (90% stake) – the market leader in fulfillment and finishing in the Czech Republic, servicing more than 200 Czech and international webshops; Prati Me/Bazzar (16%) – the leading online marketplace in Croatia offering more than 200,000 products and 700 brands and attracting more than 750,000 unique visitors per month; BoxNow (85.7%) – a last-mile operator with a network of more than 3,000 APMs in Greece, Bulgaria, Croatia and Cyprus, that works with more than 2,000 online stores and couriers; and Favi (82%) – an online marketplace with than 2,000 furniture and home accessories retailers, offering its services in nine European markets, including Italy, Great Britain, Sweden, Romania and Hungary.
By combining their assets and know-how, the new owners of Packeta seem to have most of the ingredients for an integrated e-commerce and logistics giant in central and southeastern Europe. Although most of these markets are still relatively small, they offer huge growth potential. By covering all segments – from marketplaces to fulfillment and last-mile logistics (and OOH in particular) – this has the potential to create a dominant player here before traditional giants like Amazon or AliExpress can. Currently, however, the new owners face two local e-commerce heroes in the form of Poland’s Allegro and Romania’s eMag both of which have significant last-mile and out-of-home infrastructure.
…or an even bigger plan?
An interesting detail is that Emma Capital was founded by Jiří Šmejc, who still owns a 64.7% stake. In June 2022, he was also appointed CEO of PPF, which is fully owned by Peter Kellner’s widow, Renáta Kellnerová, and family. The latter includes her daughter Anna Kellnerová, who is apparently in a close relationship with Daniel Křetínský. Could this end up being part of a much bigger plan covering all of Europe? Time will tell, but for now, the suspense builds, leaving us on the edge of our seats, wondering how the grand narrative will end!
For more on CVC’s acquisition of the Packeta Group, click here.