CPL – Aramex plans more acquisitions
Aramex plans to continue buying freight companies in key markets around the world to build up its global network, Osama Fatalleh, senior vice president and chief strategic officer, told the CPL Summit in Barcelona this week.
The Middle East-based freight logistics company wants to become the world’s fifth-largest express player through a mix of subsidiaries, alliance partners and franchises. “Our industry cannot continue to be controlled by four companies on a global scale,” Fatelleh said.
Over the last few years, Aramex had built up a worldwide network through this mixed approach but continued to face the challenge of having partners acquired by one of the big four players, Fatelleh said. In response, Aramex had decided to move from a cooperation model to a financial holding strategy in key markets such as the US, Asia and Central Europe, he said.
At the same time, Aramex was broadening its product portfolio into freight. In future, it was likely to buy freight companies and then widen them with express services since there were now few attractive express companies left to buy, he commented. Aramex also planned to open up its network to smaller local or regional players to give them more opportunity to compete with the big four integrators, he added.
Austrian Post board member Walter Hitziger told the conference that the postal group will keep the local brands of its acquired subsidiaries such as trans-o-flex, VOP (Netherlands) and DDS (Belgium) rather than operate under a single brand. This also applied to companies in Eastern European countries.
Presenting the strategy of developing into a European niche player, Hitziger highlighted that Austrian Post will focus on B2B parcels internationally, while trying to defend its domestic B2C market share from new competition. The group would try to acquire one of the top three companies in new markets, he noted.
Addressing the topic of “how to find the pot of gold at the end of the rainbow” in Eastern Europe, Marek Rozycki, CEO GeoPost Central and South East Europe, emphasized that CEP players needed special approaches in the region. Key success factors include careful preparation, flexible local structures and a decentralized organization. Above all, they need to have a clear mission, adopt realistic goals and not give up after setbacks, he commented.
Financial investors are increasingly looking at moving into the express and parcels sector, Boris Winkelmann, managing director of ITA Logistics, told the conference. Sector companies needed careful planning when considering mergers and acquisitions, he stressed. This ranged from risk analysis to in-depth strategic preparations.
