DP World acquires leading US logistics provider for $1.2 billion
DP World has announced the acquisition of 100 per cent of syncreon for an enterprise value of $1.2 billion. This transaction is subject to customary completion conditions and is expected to close in second half of 2021.
Syncreon is a US based global logistics provider that specialises in the design and operation of complex supply chains for the high growth automotive and technology industries. syncreon provides specialised value-added warehousing and distribution solutions through a variety of manufacturing, export packaging, transportation management, reverse/repair and fulfilment services.
Syncreon has a global presence across 91 sites in 19 countries and services a large and diversified porfolio of customers made up of multinational companies.
In FY2020, the group reported revenue of $1.1 billion with 57 per cent generated in Emea (predominantly Europe) and 42 per cent in North America. Syncreon has longstanding partnerships with customers averaging 18 years, and high contracts renewal rates.
Sultan Ahmed Bin Sulayem, Group Chairman and CEO, DP World, said, “We are delighted to announce the acquisition of syncreon, which adds significant strategic value to DP World given its strong logistics solutions capability, and will allow DP World to deliver end-to-end solutions to cargo owners.” The acquisition will be funded from existing available resources. DP World continues to make positive progress on its capital recycling programmes and remains fully commited to its leverage target of below 4.0x Net Debt/ebitda by the end of 2022.
Brian Enright, CEO of syncreon, said, “We are excited to join the DP World group as we believe that syncreon will benefit from the group’s significant expertise in the wider supply chain and excellent relationships with cargo owners. We share the vision of serving our customers through removing inefficiencies and delivering value add solutions. While we have enjoyed great success over the years, we believe being part of DP World will enable us to take the business to other markets.”
Earlier the DP World UAE Region, the leading smart trade enabler’s flagship Jebel Ali Port, carried out the export of 75,000 metric tonnes of rebar for Conares, the leading steel manufacturer in the Middle East. The consignment was shipped from the Jebel Ali Port to North America.
With this export, DP World UAE Region and
Conares collaborated to contribute to the UAE’S “Operation 300bn” initiative. The rebars that were manufactured at Conares’ facility in the industrial sector of Jafza were exported internationally for the first time with end-to-end handling of the cargo done by DP World’s Jebel Ali Port Operations. This first-of-its-kind operation will open doors for many more such business operations.
Commenting on this, Abdulla Bin Damithan, CEO & Managing Director, DP World - UAE Region and Jafza, said, “The industrial sector has been a key pillar not only for DP World, UAE Region, but also for the nation. His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President, Prime Minister and Ruler of Dubai recently launched ‘Operation 300bn’, a national industrial strategy aimed at raising the manufacturing sector’s contribution from Dhs133 billion to Dhs300 billion over the next 10 years, and the ‘Make It in The Emirates’ initiative, the UAE’S industrial identity to support domestic products and promote the sector globally.”
“We, at DP World, UAE Region, have always worked in alignment with the development goals of our wise leadership. Through our collaboration with Conares, we hope to underpin the frontrunning position of the UAE’S industrial sector. We are confident that Conares’ manufacturing facility and our Jebel Ali Hub with its world-class logistics ecosystem will lead this vision,” Bin Damithan added.
Bharat Bhatia, Chairman of Conares said, “Conares has been recognised as a premier producer of quality steel in massive quantities from Dubai, the strategic hub between the East and the West. We have always aligned our model to support the industrial goals of the nation and consistently worked towards making each of them a reality. We are excited to be part of the UAE’S government’s ‘Operation 300bn’ initiative by exporting 75,000 MT ‘made in UAE’ rebars manufactured by Conares. DP World, UAE Region’s stellar trade and logistics hub has enabled us to continue our endeavours. This export shipment showcases our commitment towards the same causes that DP World, UAE Region endorses. The tireless work and the unending support of the team at DP World, UAE Region and Jafza has made the success of this shipment possible.”
“Conares aligns its model to support the industrial goals of the nation. The export shipment is a step towards supporting this national goal and showcasing its commitment to contribute towards making this a reality. The export of this shipment coincides with Conares’ 10th anniversary of its rebar mill. Over 10 years, Conares has handled 10 million tonnes of steel and achieved Dhs10 billion in revenue,” he added.
Syncreon is a logistics provider that specialises in the design and operation of complex supply chains for the high growth automotive and technology industries