DHL Supply Chain has announced the signing of a shareholders' agreement with integrated energy and chemicals company Aramco for a new Procurement and Logistics Hub in Saudi Arabia to enhance supply chain efficiency and sustainability.
The international contract logistics provider said it would be the region's first such hub catering to customers in the industrial, energy, chemical and petrochemical sectors.
Source: DHL Supply Chain
"The joint venture aims to be operational in 2025 and provide reliable end-to-end integrated procurement and supply chain services for companies across the industrial, energy, chemical and petrochemical sectors," DHL said, adding that the joint venture would initially focus on Saudi Arabia, with aspirations to expand across the MENA region.
In a statement, DHL noted that Aramco's preeminent energy and industrial supply chain ecosystem and DHL's world-class logistics expertise are expected to enable the joint venture to add value in meeting customers' supply chain purchasing, warehouse and inventory management, transportation and reverse logistics needs.
The aim, it added, is for the joint venture to achieve industry best practices in procurement and supply chain management, as well as the deployment of more sustainable supply chain, transport and warehousing solutions.
"This partnership brings together two industry leaders, each with long and storied histories. By combining the exceptional energy, chemicals and industrial supply chain ecosystem of Aramco with the world-class shipping and logistics expertise of DHL, we aim to enable the Procurement and Logistics Hub joint venture to serve as a one-stop hub for customers' supply chain needs," said Amin H. Nasser, president and CEO of Aramco.
"We anticipate that it will not only advance the economic goals of our two companies but also accelerate growth across Saudi Arabia and the MENA region," Nasser added.
Oscar de Bok, DHL Supply Chain CEO, also welcomed the joint venture and its positive impact on the industry.
"We are extremely excited to announce the signing of this agreement with Aramco. Through it, DHL intends to foster its business operations and logistics networks throughout Saudi Arabia and the MENA region while expanding our industrial footprint," de Bok said.
"By working in partnership with Aramco, we aim to provide regional and multinational businesses from these sectors access to a robust international logistics network, fostering positive economic growth while promoting sustainable activities," he added.
Through state-of-the-art technologies, the joint venture is expected to allow businesses to reduce costs, maximize efficiency and harness digitalization.
DHL said in the statement that the JV represents the culmination of "several years" of cooperation between the two companies and aims to transform inventory and logistics management in Saudi Arabia and the MENA region.
The formation of the joint venture is subject to regulatory approvals and other customary closing conditions.