Nippon Express moves into the top-five airfreight players with cargo-partner deal
09 / 01 / 2024
Photo Copyright: cargo-partner
Nippon Express Holdings has completed its acquisition of several cargo-partner businesses based in central and eastern Europe.
The shares of the businesses were acquired by a special purpose company wholly-owned by Nippon Express Europe, which is in turn a subsidiary of Nippon Express Holdings.
Terms of the deal were not disclosed but when the deal was first announced in May 2023 it was expected to cost the Japanese firm around $740m.
The deal will propel the joint company into one of the top five airfreight forwarders with volumes of more than 1m tonnes.
In 2022, Nippon Express was the sixth busiest airfreight firm as it handled around 867,039 tonnes, while cargo-partner was 24th with 218,607 tonnes.
Nippon Express hopes to make further acquisitions in the future as it aims to become a “global mega forwarder” as outlined in its 2023 business plan.
The company is in discussion with several other firms with a strong regional presence, it said.
Explaining the logic behind the acquisition, Nippon Express said that the central and eastern European regions have a robust logistics base and are increasingly developing as an industrial cluster in Europe.
Meanwhile, Nippon Express’ current main strengths lie on intra-Asia and ex-Japan markets so the takeover will help it to expand its non-Japan based business and volumes.
“It is a highly reputable corporate group focused principally on air and ocean freight forwarding in Europe, Asia, and North America that also offers rail and truck transport and contract logistics services,” Nippon Express said.
The Japan-based logistics company added that the new businesses will complement its existing logistics infrastructure in Europe and lead to volume growth.
“The resultant expansion in the volume of air and ocean freight handled will also strengthen the Group’s competitiveness in the global market, enable it to respond to the diverse demands of its global customers, enhance its ability to meet logistics demand between Asia and Europe and elsewhere, and bolster its global account structure,” the company said.
Nippon Express added that the two companies have differing customer bases and differing strengths and will seek to “create synergies in their logistics operations through mutual complementation, thereby accelerating the expansion and development of their global businesses”.
In terms of customer base, Nippon Express has a focus on electric and telecommunication, automotive, pharma, apparel and semiconductor.
Cargo-partner’s strengths lie in high tech and electronics, automotive and industrial spare parts, pharma and healthcare, fashion and lifestyle, foodstuffs, perishables and retail.
“Going forward, the NX Group and cargo-partner will maximise the synergies they generate as a unified entity to help create value for the NX Group’s customers and stakeholders,” Nippon Express added.
Cargo-partner employees around 4,000 people, in 2022 had revenues of JY309bn and has warehousing totalling 300,000 sq m.
Meanwhile, Nippon Express has more than 73,000 employees, 2022 revenues of JY2,620 and warehousing totalling 7.4m sq m.
With the deal now complete, the two firms said work would get underway to integrate the two firms.
