FedEx acquires SA’s Supaswift venturesComment on this story
Johannesburg - Global logistics firm FedEx concluded that the acquisition of South Africa’s Supaswift would broaden its footprint in rapidly growing countries in southern Africa.
On Friday, FedEx said it would gain direct access to 40 facilities and more than 1 000 new team members across seven countries, including Botswana, Malawi, Namibia and Zambia, in which Supaswift traded.
FedEx, which realises in excess of $40 billion (R418bn) a year, withheld the purchase consideration in line with company policy that prohibited such disclosure, according to David Binks, the regional president for Europe, Middle East, India and Africa.
The stock gained close to 1.5 percent in New York trading on Friday from a previous close of $136.24. FedEx has a market capitalisation of $40.26 bn. Revenue for last year was $44.29bn compared to $42.68bn for the previous year.
“The acquisitions of Supaswift businesses… give FedEx Express direct access to rapidly growing countries that represent a fifth of Africa’s total GDP [gross domestic product),” Binks said.
The process began last June and had been delayed by the requirement to fulfil regulatory and customary conditions across the seven countries.
Like many multinationals, FedEx has spotted the opportunities that Africa, the next frontier, presented.
“We see Africa as a key market for our FedEx Express network, especially with its tremendous growth potential.
“While I’m unable to comment about future plans, our decisions are always based on a long-term strategic view. FedEx is always looking for opportunities to expand and provide customers with the best global connectivity.”
FedEx launched on the continent during the early 1990s and operates through a network of global service providers. “As part of our international strategy we will continue to extend our presence globally across key markets through station openings, ground infrastructure development, potential new flights and where it make sense, acquisitions,” Binks said.
Supaswift launched in 1990. In 2005 it acquired MyExpress, another former FedEx agent since 1991. Binks said Supaswift businesses, which are already prominently branded with the FedEx name, would be officially named Fed Express and over time they would be exclusively branded.
He said the direct access to the firm’s international network would enhance the customer’s speed to market and business flexibility.
According to consulting firm PwC’s Africa Gearing Up report published in October, one of the most important factors in Africa’s future development would be increasing cross-border trade within the continent and in the rest of the world. South Africa, on the 2012 Logistics Performance Index, was ranked 23 out of 155 countries and was regarded as a good performer. Between 2010 and 2012, the country’s progress improved five positions and ranked between Norway and Italy, at the time the report was published.
On the continent, South Africa was the best performer, beating Tunisia and Morocco, which were ranked 41st and 50th respectively. - Business Report