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DP World acquires leading US-based supply chain solutions provider

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DP World acquires leading US-based supply chain solutions provider. Image: DP World
DP World acquires leading US-based supply chain solutions provider. Image: DP World
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DP World announces the acquisition of 100 per cent of syncreon for an enterprise value of US$1.2 billion. This transaction is subject to customary completion conditions and is expected to close in 2H2021.

syncreon is a US based global logistics provider that specializes in the design and operation of complex supply chains for the high growth automotive and technology industries. syncreon provides specialized value-added warehousing and distribution solutions through a variety of manufacturing, export packaging, transportation management, reverse/repair and fulfilment services.

syncreon has a global presence across 91 sites in 19 countries and services a large and diversified portfolio of customers made up of multinational companies. The group focuses on two key segments. Firstly, large technology customers to enable eCommerce and omni-channel fulfilment and aftermarket services, and secondly automotive companies for reception of materials, warehousing, inventory management, kitting/sequencing for line feeding, and export packaging. This is complemented by a growing presence serving customers in Consumer Goods, Healthcare and Industrial Markets. In FY2020, the group reported revenue of $1.1 billion with 57% generated in EMEA (predominantly Europe) and 42% in North America. syncreon has longstanding partnerships with customers averaging 18 years, and high contracts renewal rates.

Sultan Ahmed Bin Sulayem, Group Chairman and CEO, DP World, said: “We are delighted to announce the acquisition of syncreon, which adds significant strategic value to DP World given its strong logistics solutions capability, and will allow DP World to deliver end-to-end solutions to cargo owners.

syncreon’s complex solutions capability brings strong long-term relationships with cargo owners, which fits with DP Worlds vision to provide smart tech-led supply chain solutions to enable trade across key markets. syncreon’s exposure to the sizeable, fast-growing technology and automotive industries offers significant growth opportunities over the medium to long term. We aim to build on this platform to deliver greater scale and provide compelling value add supply chain solutions to cargo owners across a wider market.”

The acquisition will be funded from existing available resources. DP World continues to make positive progress on its capital recycling programmes and remains fully committed to its leverage target of below 4.0x Net Debt/EBITDA by the end of 2022.

Brian Enright, CEO of syncreon, said: “We are excited to join the DP World group as we believe that syncreon will benefit from the group’s significant expertise in the wider supply chain and excellent relationships with cargo owners. We share the vision of serving our customers through removing inefficiencies and delivering value add solutions. While we have enjoyed great success over the years, we believe being part of DP World will enable us to take the business to other markets”.

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Freight Forwarding

Uber Freight to acquire Transplace

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Uber Freight to acquire Transplace. Image: Pixabay
Uber Freight to acquire Transplace. Image: Pixabay
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Uber Freight and Transplace have entered into a definitive agreement for Uber Freight to acquire Transplace for approximately $2.25 billion, consisting of up to $750 million in common stock of Uber Freight’s parent company, Uber Technologies, Inc. and the remainder in cash. Uber Freight will acquire Transplace from TPG Capital, the private equity platform of alternative asset firm TPG.

Uber Freight’s acquisition of Transplace will create one of the leading logistics technology platforms, with one of the largest and most comprehensive managed transportation and logistics networks in the world. The transaction is subject to regulatory approval and other customary closing conditions.

The acquisition comes at a time of accelerated transformation in logistics. The demands of a volatile market and the increasing complexity of globalized logistics are clashing with industrial-age transportation technology. In the midst of capacity constraints and escalating transportation costs, shippers are adapting their operations at an increasing pace and looking for technology, support, and solutions that can modernize their supply chain and keep critical goods, and the economy, moving.

“This is a significant step forward, not just for Uber Freight but for the entire logistics ecosystem,” said Lior Ron, Head of Uber Freight. “This is an opportunity to bring together complementary best-in-class technology solutions and operational excellence from two premier companies to create an industry-first shipper-to-carrier platform that will transform shippers’ entire supply chains, delivering operational resilience and reducing costs at a time when it matters most.”

“The acquisition will combine the world’s premier shipper network platform with one of the industry’s most innovative supply platforms, to the benefit of all stakeholders,” said Frank McGuigan, CEO of Transplace. “Our expectation is that shippers will see greater efficiency and transparency and carriers will benefit from the scale to drive improved operating ratios. All in all, we expect to significantly reduce shipper and carrier empty miles to the benefit of highway and road infrastructures and the environment. Finally, we want to thank TPG for their partnership as we have worked together to position Transplace as a leader in supply chain innovation.”

Transplace was acquired by TPG Capital in 2017. Over the course of the partnership, Transplace has invested heavily in technology and other growth initiatives to further bolster the company’s expansive, high-quality, customizable solutions for managing today’s supply chain. Digitization of the global supply chain and the rapid adoption of logistics technology and solutions continue to drive investment activity across TPG’s platforms.

“Our partnership with Transplace is a strong example of TPG Capital’s strategy to identify industry-leading tech-enabled services companies and invest behind them to drive sustained growth,” said Jack Daly, Partner at TPG Capital and Chairman of Transplace, and Alex Minasian, Principal at TPG Capital. “In a category that continues to benefit from several secular tailwinds, Frank and his experienced team have positioned the company as an innovative leader that is empowering customers of all sizes to improve and optimize their supply chains. We thank the entire Transplace team for their partnership and wish them continued success in their next chapter.”

A logistics platform built for both shippers and carriers

The combination of Uber Freight and Transplace will optimize the movement of freight across the entire marketplace and deliver best-in-class services to shippers, while also unlocking opportunities for carriers. Uber Freight’s vast network of digitally-enabled carriers, combined with Transplace’s trusted shipper technology and operational solutions, will result in a fully scaled logistics platform built to meet both shippers and carriers where they are, no matter the size of their business or their transportation needs.

The combination of trusted services and technology solutions available via Uber Freight will help reduce friction across the supply chain and enable a new era of logistics management:

Shippers will have access to an even more robust set of technology solutions across all transportation modes and services, bolstered by support services based on Uber’s advanced technology and data science expertise.
Carriers will have the ability to collaborate directly with shippers within a seamless marketplace as well as access high quality freight across multiple expanded service lines, including intermodal, cross border and Less-Than-Truckload.

Uber Freight’s brokerage will continue to operate independently from Transplace’s managed transportation services to ensure the highest-quality service for shippers.

Accelerating Uber Freight’s path to profitability

Completion of this transaction will enable Uber Freight to serve substantially more customers at all levels of the freight industry and will expand its presence into Mexico and through new capabilities in intermodal and customs brokerage.

This transaction is expected to accelerate Uber Freight’s path to profitability and help the segment to break even on an Adjusted EBITDA basis by the end of 2022.

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Freight Forwarding

Dronamics and DHL enter partnership for middle-mile drone delivery 

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Dronamics and DHL enter partnership for middle-mile drone delivery. Image: Dronamics
Dronamics and DHL enter partnership for middle-mile drone delivery. Image: Dronamics
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DRONAMICS has signed a partnership agreement with the world’s number one logistics company – DHL Deutsche Post.

With the signed partnership, DHL and DRONAMICS agree to jointly develop solutions and offer same-day cargo drone deliveries to customers using DRONAMICS’ drone delivery network and Black Swan drones. Both companies are discussing mutual exclusivity for middle-mile drone deliveries in selected industries and markets. In addition, DRONAMICS’ goal to become carbon-negative by 2027 and direction to operate on sustainable biofuels in the future will play a part in helping DHL achieve its goal of becoming carbon neutral by 2050.

“Innovation is a key part of DHL’s DNA. We are constantly exploring new technologies to bring value to our customers, and we believe that cargo drones will be an element in the next generation of transportation in logistics. DRONAMICS is a pioneer and leader in the field of cargo drones and our collaboration will help to open up opportunities for urgent, sensitive and time-critical deliveries. We are excited to pilot the use of the Black Swan in customer operations in the near future”

Matthias Heutger, Senior Vice President, Global Head of Innovation & Commercial Development at DHL

“We are incredibly excited that DRONAMICS has been selected by DHL, the world’s largest logistics provider as their first middle-mile drone partner, with a partnership that provides mutual exclusivity in selected industries and markets. This partnership has the potential to generate €1.86 Bn to DRONAMICS’ revenues annually, with plans underway to build and operate over 4,000 cargo drones to support the partnership in the coming years” Svilen Rangelov, Co-Founder and CEO of DRONAMICS

The partnership aims to combine middle-mile cargo drones with DHL’s first and last-mile services. As part of the agreement, DRONAMICS will provide equipment and expertise to operate the unmanned drone flights, employing staff in handling and technical roles. The first commercial flights of the same-day drone cargo services are expected to begin in 2022.

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Freight Forwarding

Aramex and DB Schenker sign a Strategic MoU to expand in Abu Dhabi

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Aramex and DB Schenker sign a Strategic MoU to expand in Abu Dhabi. Image: DB Schenker
Aramex and DB Schenker sign a Strategic MoU to expand in Abu Dhabi. Image: DB Schenker
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Aramex a leading global provider of comprehensive logistics and transportation solutions, and Germany-based DB Schenker, a global leader in supply chain management and logistics solutions,  announced the signing of a strategic Memorandum of Understanding (MoU) with the aim to drive forward synergistic opportunities in supply chain solutions across multiple critical industries to and from Abu Dhabi and the wider MEA region.

By leveraging DB Schenker’s extensive global experience in specialized freight forwarding solutions across multiple industries, the partnership will seek to further boost Aramex’s capabilities and offerings in the region, including, but not limited to, the aerospace, defense, infrastructure, and healthcare industries. Conversely, by teaming up with Aramex and capitalizing on its strong brand identity, leadership position, deep knowledge and expertise in the region, DB Schenker will be able to expand its presence more comprehensively in Abu Dhabi, a strategic and growing trade and logistics hub in the MEA region.

Commenting on the MoU, Othman Aljeda, Chief Executive Officer of Aramex, said: “This is a very exciting strategic partnership that has the potential to unlock more value for existing customers while also enabling us to realize our commercial and diversification goals. Over the several years, we have been strategically focused on enhancing our core freight forwarding business through investment in technologies and expanding on the ground operations with the intention of enhancing our capabilities, capturing greater market share in core markets and diversifying our customer base by penetrating new industry verticals. By joining forces with DB Schenker, a global logistics company we regard as truly complementary to ours in the region, we will accelerate the realization of our goals in the freight forwarding business. Our alliance will enable Aramex to become a stronger, more competitive player in the sea and air freight forwarding services in Abu Dhabi and other core markets. While we are working on the partnership agreement and will update the market in due course on our final agreement, on behalf of the Aramex team, I look forward to working alongside the DB Schenker team.”

Christopher Smith, Chief Executive Officer of DB Schenker, Middle East & Africa, said: “At DB Schenker, we recognize the immense opportunities emanating from Abu Dhabi and the MEA region. We believe our alliance with Aramex was a natural choice given their history, expertise, knowledge, and extensive network in the region. I am confident that together, we will be able to grow our footprint in Abu Dhabi and the wider MEA region. We are excited about this expansion plan, and we look forward to realizing synergies and scaling our operations in the region to serve our existing major accounts and new potential clients more comprehensively.”

Traditionally Aramex’s freight forwarding business was largely focused on the cyclical Oil & Gas (O&G) sector. While the company will continue to serve this important sector, the energy industry has witnessed lower levels of activities in recent years, which inevitably had a knock-on effect on Aramex’s freight forwarding business. However, in 2020 the healthcare, pharmaceuticals and FMCG segment helped offset some of the weakness from O&G. Going forward, the company will continue to strengthen its freight forwarding capabilities through strategic partnerships, investment in technologies and hiring and upskilling the necessary talent.

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