Monday, December 15, 2014

Freight Forwarding and Logistics Outfit Buys Shop Counter Franchise Service

Shipping and Express Delivery Portfolio Suite Now Available at 287 Store Locations
Shipping News Feature

SOUTH AFRICA – UAE – In another acquisition this week by a Middle Eastern logistics group, Aramex, the freight forwarding and express delivery outfit, has purchased the master franchise for the PostNet brand in South Africa. PostNet is South Africa’s largest privately-owned counter network in the document and parcel industry. The transaction involves a 100% buyout of the business from current owner OneLogix Group for $16.5 million.

PostNet provides a one-stop business centre for entrepreneurs, businesses, households and consumers, offering services including courier, copy, digital print, stationery, mailboxes and more. Since starting operations in 1994, PostNet South Africa has grown into a chain of 287 stores and services 55,000 customers daily across the country. While Aramex will own the master franchise for PostNet in South Africa, each PostNet store in the country will continue to be owned and operated by the respective franchisees. As master franchisee, Aramex will work in close collaboration with each PostNet store, to further grow the retail potential of the brand in South Africa.

Following the acquisition, Aramex B2C services, including international and domestic express shipping and its unique e-commerce business Shop and Ship (called Aramex Global Shopper in South Africa), will be made available across all PostNet locations in South Africa. This will further extend Aramex’s reach in Africa by giving PostNet customers full access to its client – focused, technology-driven solutions. Hussein Hachem, Chief Executive Officer of Aramex explained:

“We are excited to further expand our global network through the acquisition of PostNet’s master franchise. As we continue to scale Aramex into new growth markets and bridge trade corridors, this acquisition will expand Aramex’s volume of business in Africa considerably. Investing in growth markets’ e-commerce sectors is also part of our wider strategy to maintain Aramex’s position as an e-commerce market leader, which is why we are disciplined in our approach to potential acquisition targets. Aramex only targets companies such as PostNet who are a perfect strategic fit in order to leverage their suitable, scalable synergies with our existing infrastructure. We will remain bullish on our outlook for future acquisitions in markets across Asia, the Middle East and Africa in particular, both to build our operations and strengthen our global footprint.”

Aramex first entered the South African market with the acquisition of Berco Express (now Aramex South Africa) in 2011, which also created the platform for its entry into the Southern African region. The acquisition of PostNet South Africa should provide significant opportunities for Aramex to continue its regional expansion, taking advantage of increasing demand for logistics, delivery and business solutions. Chris Wheeler, Chief Executive Officer of PostNet, said:

“We are very proud of the PostNet business and network we have built in South Africa over the past two decades. During this time, PostNet has grown into one of the country’s most trusted and respected brands. Our reach across South Africa, in addition to the range of logistics and business solutions we provide, have resulted in significant competitive differentiation for our business and brand. We believe Aramex is the right partner for us to further expand PostNet’s presence in South Africa as well as across Africa. Our customers will now also be able to benefit from Aramex’s global network, breadth of shipping and delivery options and its innovative, customer-focused technologies, whilst still being able to enjoy our services.”

The matching of services looks to be a sensible move for Aramex which will enable it to reach customers that hitherto would not have appeared on the company radar. PostNet currently offers services in tandem with DHL, with whom one of Aramex’s negotiating team, Dave Spargo, formerly worked, and Andy van der Velde, Chief Executive Officer of Aramex, South Africa, observed:

“Following the acquisition of Berco Express in 2011, this deal will further extend Aramex’s unique service proposition to so many more locations across South Africa, with customers now being able to pick up and drop off packages from across 287 locations. The excellent levels of service, international expertise and scale that Aramex provides will now be made even more accessible to South African businesses and consumers. We continue to view South Africa as a highly attractive market with significant growth prospects and this acquisition is testimony to our long-term commitment to investing in the country’s sustainable development.”

Photo: The two sides sign the deal. Back L/R: Geoff Glass (OneLogix), Cameron McCulloch (OneLogix), Dave Spargo (Aramex) Front L/R: Ian Lourens (OneLogix), Chris Wheeler (PostNet), Andy van der Velde (Aramex)