Aramex, the Middle East's biggest courier company, entered a binding agreement to fully acquire Florida-based MyUS for a cash price of $265 million, as part of its strategy to grow its e-commerce operations.
The deal, which is subject to closing conditions, will provide benefits for both parties including operational synergies, improved efficiencies, shared technology platforms and the opportunity to serve new markets, Aramex said in a statement on Wednesday.
"We believe this transaction will open new trade lanes for both companies, as well as increase trade flow from major global trade hubs into the Middle East, where Aramex is a leading player," said Othman Aljeda, chief executive of Aramex.
"We are acquiring a profitable business and this transaction is value accretive to Aramex and our shareholders."
Courier companies such as Aramex benefited strongly from a surge in demand for logistics and freight-forwarding services during the Covid-19 pandemic as e-commerce picked up. Aramex reported a 3 per cent annual rise in net profit on higher revenue and improving global operations. Net profit for the three-month period through to the end of March rose to Dh47 million ($12.8m).
However, as is the case with its peers in the industry, it has also been hit with rising costs as a result of supply chain bottlenecks, as well as slowing demand for e-commerce as cross-border travel improves and pandemic-related restrictions are eased.
The acquisition is in line with Aramex’s strategy to expand its cross-border operations and to capitalise on attractive growth opportunities in the $4 trillion global e-commerce sector, the Dubai-listed company said.
MyUS has opened US retail channels to international shoppers: members sign up online and get a MyUS shipping address before shopping at US and UK retailers then shipping their order to their MyUS address.
The company offers a simpler and cost-effective shipping process and complete online account management to more than 6.6 million members in 220 countries and territories, including Saudi Arabia and the UAE, according to its website.
MyUS receives and ships more than $292m in e-commerce purchases annually, with hundreds of members joining daily to use its international shipping services, according to the 24-year-old company.
"Aramex’s acquisition is a testament to our strength, future potential and scale and success in growing our footprint in the attractive, fast growing and evolving global e-commerce business," said Ramesh Bulusu, chief executive of MyUS.
"This acquisition allows our customers and business partners to benefit from Aramex’s global network, international expertise and scale."
Aramex will fully disclose the details of the transaction on closing, which is expected in the third quarter of 2022, it said.
