Nippon Express has announced its acquisition of Austrian full-range logistics provider, cargo-partner, making it a subsidiary of the Japanese global logistics services company.

The deal was signed on May 12, 2023, and will come into effect subject to the usual regulatory (anti-trust and FDI) approvals in an estimated four to seven months along with the subsequent closing.

While the cost of the transaction was not disclosed by both parties, Japanese financial publication, Nikkei Asia, reported that the deal was worth around US$743 million.

Growth expansion plans

Nippon Express said the acquisition is part of its planned growth worldwide.
 

"Our group aims to become a logistics company with a presence in the global market that contributes to the global expansion of our customers by providing supply chain solutions across a variety of transportation methods  — road, air, and sea — across the globe," the Japanese global logistics services company said.

To realize this aim, it added that the group has worked on the Nippon Express Group Business Plan 2023 — "Dynamic Growth" — since 2019, and has executed a number of cross-border M&A transactions as part of our inorganic growth strategy.

Source: Nippon Express

In particular, Nippon Express cited cargo-partner's strong logistics business platform in the Central and Eastern European region which has attracted attention as an industrial base for Europe.

"cargo-partner operates its air and sea forwarding business across Europe, Asia and North America in the automotive, electric and electronics, and pharmaceutical/medical industries which are all part of the core business for growth as set out in "Nippon Express Group Business Plan 2023 - "Dynamic Growth," it said.

"As a result, we concluded that it is highly beneficial for us to welcome cargo-partner into our group in order to further strengthen the forwarding business through synergies and, by leveraging the competitive strengths of each company, to create an even more active sales and marketing operation, and to increase our presence in the global market," it added.

Nippon Express said it would also be able to capture new growth areas through the addition of cargo-partner to its business by strengthening its network and services in the European area; strengthening its competitiveness in global markets through an increase in air and sea forwarding volume; and also boosting the company's ability to meet the demand for logistics between Asia and Europe.

Nippon Express also noted that the two companies' logistics businesses are "complementary" due to the different areas of strengths of both Nippon Express and cargo-partner.

"Further expansion of the business of cargo-partner as a member of our group will help realize the growth targets of both companies as well as contribute towards an increase of our corporate value," Nippon Express said.
 

"Ideal successor" for cargo-partner

cargo-partner also confirmed the transaction in a separate statement.

"As cargo-partner is celebrating its 40th anniversary, company owner and founder Stefan Krauter has decided to sell the Austrian global logistics player to Japanese stock-listed Nippon Express Holdings, which is also the parent company of Nippon Express, APC, Franco Vago and others," cargo-partner said.

"Stefan Krauter had already passed on the baton to his management and now has also passed over ownership to his 'ideal successor' NX," the statement added.

The Austrian logistics provider noted that after exceeding the billion euro mark in global turnover for the first time in 2020, cargo-partner's turnover increased by 72%, reaching over 1.8 billion euros in 2021, and further increased to 2.06 billion euros in 2022.

"Leadership by agile founders bears some considerable advantages, but from a certain stage on, highly professional and long-term stable ownership is the bigger asset. It is the founders' challenge and responsibility to decide about both management and ownership succession at the right time. Not too early to be able to build a stable internal management succession but, for sure, also not too late," Krauter said.

"That is why, together with the Corporate Executive Board, we started evaluating different options for the future of cargo-partner," he added.

The cargo-partner chief noted that it would also have been a "good option" for the management and employees to continue going completely alone, but since the ideal new strategic owner was found in NX Group, "we were ultimately convinced that this was the right way to go forward."

“Both organizations will benefit from considerable synergies in global office coverage, an expanded service portfolio, strengthened regional, product and IT know-how, increased scale and others," Krauter added, noting that the NX Group will benefit from cargo-partner's extensive network in Central and Eastern Europe that complements NX's existing network.

cargo-partner will also leverage NX Group's presence for Intra-Asian and Trans-Pacific trade lanes.

"cargo-partner will also continue to work with its current global agents' network, strive to expand this section of its business and support it in future with its upgraded platform which is presently under development," Krauter said, adding that he will transition into his new role on the Corporate Supervisory Board and in an advisory function to the Corporate Executive Board.