3rd Sept 2019

Panalpina (ticker: PWTN) is a Swiss-listed global third-party logistics provider that we have been following for a considerable time. As we identified two years ago, the logistics industry is reasonably fragmented and various companies have been active in trying to consolidate the industry, growing larger in order to generate economies of scale.

We believe that poor corporate governance tends to lead to less than optimal outcomes for shareholders and, conversely, improvements get rewarded by improved market valuations over the long-term. Panalpina is an example of an investment which required us to undertake active private and public engagement with other stakeholders in order to protect minority shareholder rights and which had a positive impact on the value of our investment.

The catalyst for our investment in late November 2018 was two-fold. Firstly, the value of the shares had fallen to the lower end of a well-established trading range and appeared to be reasonably attractive in comparison to its peers.