ADQ, one of the region’s largest holding companies, acquired 22.25 per cent of the Middle East's biggest courier company Aramex, building on its portfolio of existing investments in Abu Dhabi.
The shares were acquired through a series of on-market transactions and through an off-market special deal, ADQ said in an emailed statement on Thursday.
"Aramex is a global leader in logistics and transportation, and will complement our logistics investments including Abu Dhabi Ports, Abu Dhabi Airport, and Etihad Rail as we work to expand the logistics ecosystem in the UAE," Murtaza Hussain, acting chief investment officer of M&A and alternative investments at ADQ, said.
The stake purchase follows a flurry of activity by the Abu Dhabi holding company this year. Earlier this month, ADQ launched a new organisation to manage the procurement of healthcare products in Abu Dhabi.
In August, ADQ partnered with the Abu Dhabi Investment Office (Adio) to develop the emirate's start-up ecosystem and attract further investments into its digital economy. A month earlier, Adnoc agreed to form a joint venture with ADQ to hasten the development of chemicals manufacturing at Ruwais.
"Despite the challenging market conditions, we are confident that Aramex has the right approach to continue building on its leadership position in the industry and enhances Abu Dhabi’s efforts to be a key player in international trade and logistics," Mr Hussain said.
Last month, Aramex said its domestic business grew 31 per cent in the second quarter as customers, confined to homes as a result of the Covid-19 pandemic, turned to e-commerce sites to buy goods, particularly those based in Saudi Arabia, UAE, and Kuwait.
"With the surge in e-commerce demand this year, their on-the-ground operations and last mile capacity is an important growth area," Mr Hussain said.
Aramex was founded by Fadi Ghandour in 1982 and was the first company from the Arab world to list on the Nasdaq. It later delisted in 2002 and went public again in 2005 and is currently listed on the Dubai Financial Market. Mr Ghandour sold his remaining shares in Aramex in 2016.
ADQ was established in 2018 and has been expanding as of early this year. It has a portfolio of conglomerates spanning key sectors of Abu Dhabi's non-oil economy including utilities, tourism and hospitality, aviation, transportation, logistics, industrial, real estate, media, healthcare, agri-foods and financial services.
Its portfolio includes Abu Dhabi Power Corporation, Abu Dhabi Airports, Abu Dhabi Ports, Etihad Rail, Seha, insurer Daman, media companies Abu Dhabi Media and twofour54 and Abu Dhabi National Exhibitions Company, among others.
Wizz Air Abu Dhabi, a joint venture between the Hungarian budget airline and ADQ, will operate its first flight next month.
In a September 21 bourse filing, Aramex confirmed the deal saying “Alpha Oryx Limited, a company related to Abu Dhabi Developmental Holding Company (ADQ), has recently acquired 22.25 per cent of Aramex issued shares capital”.