Fed-Ex Corp tipped to buy major stake in Hermes

US giant Fed-Ex Corp has been tipped to buy a stake in Hermes’ European parcel delivery operation whilst private equity house Advent International is in the frame to become a major investor in Hermes’ UK operation.

The claims, made by German newspaper Handelsblatt, follow a recent announcement by Hermes owner Otto Group that it is in advanced discussions with a large strategic investor.

Alexander Birken, Otto Group chief executive, said last week: “We are well advanced in discussions with potential partners,” adding that under a strategic partnership “we would be more stable in the long term - we could achieve synergies and exchange know-how, depending on who we go with and we can make the necessary investments together."

Last week Petra Scharner-Wolff, Hermes finance chief said the company had received broad interest from contenders. Other likely candidates named in the report are Amazon and the logistics arm of Ali Baba.

A partnership with Hermes would give Fed-Ex Corp a greater share of the home delivery market which has been significantly boosted by a surge in online shopping during the Covid-19 pandemic.

In April, Advent International chairman David Mussafer told the Financial Times that it has started talks with “global leaders” about possible deals, adding that the impact of the Covid-19 pandemic had opened up opportunities to get involved with companies that might “hitherto not have been interested, or needed capital, or sought a partner".

Otto Group and FedEx Group declined to comment.

An Advent International spokesman said the company would not comment on speculation.