NEWS INTERNATIONAL ASIA CHINA Chinese media has reported the founding of a state-owned logistics group which aims to strengthen supply chains amid pandemic disruption. The new company, China Logistics Group, was formed through a merger with China Railway Materials, China National Materials Storage and Transportation Group, Huamao International Freight Limited Company Shenzhen Branch, China Logistics and China National Packaging Corporation. The merger follows global supply chain disruption which has constrained operations particularly at Chinese ports where just one Covid-19 case can result in business suspension. Strategic investors and parent firms of China Eastern Airlines, COSCO Shipping and China Merchants Group will respectively hold share percentages of 10 per cent, 7.3 per cent and 4.9 per cent in the newly-formed group. China’s State-owned Assets Supervision and Administration Commission (SASAC) and China Chengtong Holdings Group will evenly split the remaining shares. Chengtong Holding is centrally-managed by SASAC, giving the state asset regulator control over all the remaining shares. China Logistics Group is reported to cover 30 Chinese provinces, has a presence in five continents and operates three million vehicles. HONG KONG Danish shipping company, Maersk, has reached an agreement to acquire a Hong Kong-based contract logistics company which specialises in omnichannel fulfilment services, e-commerce and inland transport. Maersk is set to acquire LF Logistics. The transaction will add 223 warehouses to the existing portfolio, 6 / G L O B A L TR A I L E R / I SS U E 6 3
bringing the total number of facilities to 549 globally, spread across a total of 9.5 million square metres. “The acquisition of LF Logistics is an important and truly strategic milestone on our journey to become the global integrator of container logistics; a global logistics company that provide digitally enabled end-to-end logistics solutions based on control of critical assets,” said Maersk CEO, Soren Skou. “With the acquisition of LF Logistics, we add critical capabilities in Asia Pacific to support our customers long term growth in Asia Pacific as well as capabilities and technology we can scale in our contract logistics business globally.” As part of the agreement to acquire LF Logistics, Maersk will enter a strategic partnership with Li & Fung to develop logistics solutions. LF Logistics operates an extensive Pan-Asian network for B2B and B2C customers within retail, wholesale and e-commerce. “We recognise that for LF Logistics to be a global leader in the industry, achieving scale is of paramount importance,” said the CEO of Li & Fung and LF Logistics, Joseph Phi. “Maersk provides the ideal fit for our people and our customers. It has a substantial presence around the world and will utilise LF Logistics’ talent base and operational platform across Asia to build out its logistics and fulfilment offering globally. “This is testament to the strength of our team, our unique operations-centric culture, and superb growth potential. Together we will deliver a compelling value proposition that allows our people to attain their full potential and our customers to achieve sustainable competitive advantage.” LF Logistics is a privately owned
company by Li & Fung (78.3 per cent) and Temasek Holdings (21.7 per cent). LF Logistics is organised through two business units: In-Country Logistics (ICL) and Global Freight Management (GFM). Founded in 1999, LF Logistics is primarily focused on providing contract logistics solutions to customers in Asia-Pacific. LF Logistics is run as a standalone company separate from Li & Fung. Over the last 22 years, LF Logistics has significantly expanded its geographic presence, with an intention of providing integrated logistics solutions to customers across Asia-Pacific. LF Logistics employs 10,000 people and has 223 warehouses and fulfilment centres in 14 countries totalling 2.7 million square meters. In the full-year 2020, LF Logistics reported a revenue of around 1.3 billion USD and a post-IFRS 16 adjusted EBITDA of USD around 235 million USD, with the ICL business generating a revenue of around 850 million USD and a post-IFRS 16 adjusted EBITDA of around 230 million USD. For the fullyear 2021 the ICL business is expected to report a revenue around $1 billion USD with an adjusted post-IFRS 16 EBITDA around $250 million USD. RUSSIA Logistics firm, Tablogix, has acquired the warehouse and transport operations of Finnish company, Itella Logistics. Tablogix has taken the Moscow facilities of Itella LLC (part of Itella Logistics) which includes warehouses in Krekshin (60,000 square metres), Odintsovo (40,000 square metres) and Khimki (80,000 square metres). In 2020, Tablogix’s warehouse operations reportedly accounted for more than 200,000 square metres of rented and client space in the Moscow
