German rail group Deutsche Bahn (DB) has agreed to sell its logistics arm DB Schenker to Danish company DSV in a €14.3bn (£12bn) deal.

The agreement is subject to final approval by DB’s supervisory board and the German government and is expected to be completed in 2025.

It added that DSV planned to invest around €1bn (£839.2m) in Germany and the aim was to create a global market leader in transport and logistics.

Richard Lutz, CEO of DB, said: “The sale of DB Schenker to DSV marks the largest transaction in DB’s history and provides our logistics subsidiary with clear growth prospects.

“In line with our strong rail strategy, we are focusing our business on rail infrastructure in Germany that serves the common good as well as on climate-friendly passenger and freight transport in Germany and Europe.

“At the same time, reducing debt will make a substantial contribution to the group’s financial sustainability.”

DSV Group CEO Jens H. Lund said it had a clear plan for becoming one of the world’s leading transport and logistics companies: “Hand in hand and under one roof, the employees of DSV and Schenker will combine our strengths to create a true global leader in the industry,” he said.

“This strategic combination with significant investments in competitiveness will ensure long-term growth and create sustainable jobs in Germany.”

Two years ago, DB said the proposed sale of DB Schenker to DSV would allow it to sharpen its focus on its core business and pay off some of its debt.

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