UPS has announced the purchase of UK transport and logistics firm, Freightex.
According to the US logistics giant, the acquisition immediately establishes UPS’s presence in the growing UK and European third-party logistics and freight brokerage market, and will help it launch a “new global and regional UPS growth platform from an established base of customers and carriers”.
“The UK and Europe are strategic 3PL freight brokerage growth markets for UPS and there is significant cross border opportunity,” said Alan Gershenhorn, UPS’s Chief Commercial Officer.
The transaction follows UPS’s acquisition of Coyote Logistics in August 2015, with UPS hoping to benefit from the two companies’ complementary business models.
“This acquisition provides UPS customers an immediate, knowledgeable and competitive UK and European presence. We intend to align Freightex with Coyote for greater efficiency and continue to invest for further growth,” Gershenhorn explained.
“UPS expects to share the best system technologies, business processes, as well as leverage customers and carriers across the two units.”
According to a study by Grand View Research, the European 3PL market was forecast to reach $174 billion by the end of 2016, with the freight brokerage segment growing especially fast.
“Brokered shipping services often provide greater efficiency brought about by higher fleet asset utilisation when compared to operating dedicated fleets,” UPS explained in a media briefing.
“More than one-half million road freight carriers currently operate in Europe, presenting significant opportunities to expand UPS’s existing carrier base to create more value for customers and carriers from the advantages of higher equipment and staff utilisation.”
“We are excited to join the UPS organization and Coyote brokerage operations,” commented Tim Phillips, Freightex’s Chief Executive Officer. “UPS and Coyote have industry-leading technology, a no-excuses customer service culture, and a proven record of success.
“We will improve our efficiency through Coyote’s technology and use of the UPS network, while continuing to out-service the competition and provide results that customers count on us to deliver.”
Phillips will continue to lead the Freightex business, which will operate as a wholly-owned subsidiary of UPS.