SF Holding set for $2.3bn Kerry Logistics investment

By Damian Brett

Express firm SF Holding is set to buy a majority stake in Kerry Logistics as it looks to build its international supply chain presence.

The proposed deal will see SF Holding take a 51.8% stake in Kerry Logistics, with the deal valued at around $2.3bn.

News that a deal could take place broke on Friday as both companies put their shares on hold.

The deal will give Kerry Logistics access to SF’s network in China, while the express firm will gain through a greater international and regional presence, helping it to expand beyond China.

The companies said that Kerry Logistics Network will be positioned as SF Holding’s platform for international business.

They will also collaborate with each other in Greater China to better align their respective businesses.

“By tapping into different customer segments, SF Holding and Kerry Logistics Network will coexist as separate entities in Mainland China, Hong Kong and Macau,” Kerry Logistics said. “[Kerry Logistics] will continue to grow its logistics businesses, both in terms of scale and coverage.

“The partnership is expected to create significant synergies to boost both companies’ growth and leadership in the logistics sector with clear business focuses and complementary strengths to bring value to investors.”

The deal will require more than half of Kerry’s independent shareholders to accept the cash offer. 

They added: “The cooperation will bring together the core competencies of SF Holding and Kerry Logistics Network across multiple verticals to create a leading Asia-based global logistics platform to meet ever-changing demands.”

As part of the deal, Kerry Logistics Network’s warehouse assets in Hong Kong will be disposed of to a wholly-owned subsidiary of Kerry Holdings.

SF plans to pay for the deal through external funding. 

SF has been growing rapidly over recent years as it benefits from the online shopping boom and had previously said it was looking to develop its logistics offering.

This would not be its first investment in expanding its logistics capabilities in recent years.

In 2019, Deutsche Post DHL (DPDHL) concluded a deal to transfer its supply chain operations in China to SF Holding in a ten-year strategic partnership to grow the business in China.

From an airfreight perspective, SF Holding’s fleet has also grown rapidlySF Airlines is currently the largest cargo airline in China, with a fleet of 61 aircraft, serving more than 70 cities.

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