Japan Post eyeing tie-ups for international distribution of goods

Japan Post is nearing the final stage of negotiations on comprehensive tie-ups with several major distribution companies such as TNT Post Group of the Netherlands and Japan’s major delivery company Nippon Express Co., a news report said Wednesday.

The company wants the tie-ups, expected to be concluded by the end of the year, so it can set up joint firms to distribute goods for companies and gain a foothold in Asia, the largest daily Yomiuri Shimbun said.

Under the current law, Japan Post can only transfer international mail it receives in Japan to a postal service operator in another country.

But the company wants to expand its services to better respond to the demands from domestic companies, such as speedy delivery, the paper said.

On Tuesday, Japan’s lower house of parliament passed legislation to privatize the country’s vast postal system, which would allow Japan Post to start international distribution of goods starting April 2006.

As the bills are likely to be enacted Friday after a vote in the upper house of parliament, Japan Post will likely be able to enter the final stage of negotiations, the paper said.

Japan Post is trying to diversify its management as the number of pieces of mail it handles has been on the decline after peaking in fiscal 2001, which ended March 2002.

Yomiuri said, citing sources, Japan Post is planning to tie-up with TPG to establish a distribution company. Other prospective partners include Japanese distribution companies such as Nippon Express and Sankyu Inc..

Through this tie-up strategy, Japan Post hopes to compete with major international distribution companies, which are locked in fierce competition with each other in the Asian market, such as DHL International Gmbh, an affiliate of Deutsche Post, as well as FedEx and United Parcels of America, Inc. of the United States, the paper said.

Officials of Japan Post, which became a public company in April 2003, were not immediately available for comment.

Japan Post in mail distribution talks with TNT, Nippon Express, Sankyu – report
AFX International Focus 10-12-2005

AMSTERDAM (AFX) – TNT NV is a candidate to set up a mail distribution company with Japan Post, Japanese daily Yomiuri Shimbun reported.

According to sources, Japan Post is eyeing several candidates at home and abroad to set up goods distribution companies. Currently, Japanese law effectively prevents local mail companies from teaming up with foreign partners.

Other candidates mentioned by the paper are Nippon Express and Nippon Steel Corp’s Sankyu Inc affiliate.

TNT was not immediately available for comment.