Panalpina has signed an agreement to acquire Air Connection, a Kenyan family-owned forwarder which specializes in the export of flowers and vegetables.
“The acquisition of Air Connection will strengthen our existing global perishables network and our position as the clear market leader in the perishables arena in Kenya,” said Stefan Karlen, CEO of Panalpina.
Air Connection is the fourth-largest forwarder in Kenya in terms of air freight export volumes. The merged company is expected to handle approximately 70,000 tonnes of perishable air freight per year.
“While most of Panalpina’s flower exports from Kenya currently go to auctions in Amsterdam, we are specialized in direct shipments to customers,” said Manjit Brar, owner and managing director of Air Connection, who will remain as a consultant. “And while Panalpina is strong with big charter shipments from Kenya to Europe, our strength lies in smaller shipments on scheduled passenger flights to over 150 destinations worldwide.”
In 2016, Panalpina also acquired a majority stake in Airflo, a forwarder based in Kenya and the Netherlands specializing in fresh flowers and vegetables.
“Increasingly, buyers of perishables want to source directly from the producer and producers want to sell directly to the country of consumption,” said Conrad Archer, managing director of Panalpina Airflo. “Direct shipping bypasses intermediaries, reducing touch points in the supply chain. It removes unnecessary costs, potential delays and most importantly allows a fresher product to be offered to the consumer. At the same time, this development will make sophisticated end-to-end solutions even more important than today. Joining forces with Air Connection will offer additional opportunities to grow the perishables business in Kenya, especially with the export of vegetables, herbs and cuttings.”
The merged company will employ over 350 people in Nairobi and offer 3,000m2 of cold storage capacity. It will also run an office at the port of Mombasa to develop the sea freight business for both perishables and dry cargo, according to Panalpina.
