DHL has acquired Romanian firm Cargus for a reported €50 million to become the clear leader of thecountry’s fast-growing express and parcels market. This is the fourth major transaction in Romania
in the last six weeks.DHL Romania announced yesterday that it had bought Cargus for an undisclosed price tostrengthen its position in the market. Romanian newspapers Ziarul Financiar and Business Standardeach cited market sources as saying that DHL would spend about €50 million on the acquisition of100% of the Cargus shares.
The Romanian CEP market is rapidly consolidating. Within the last few weeks, GeoPost hasbought an 80% stake parcels firm Pegasus and UPS announced the acquisition of its local servicepartner, Trans Courier Service (TCS). Meanwhile, Romanian IT services company Asesoft has taken a25% stake in Curiero, according to local media.
The latest deals will make DHL/Cargus into the dominant player in Romania ahead of TNTExpress, UPS/TCS, GeoPost/Pegasus and locally-owned Fan Courier, Curiero and TCE, according to the “ CEP Market Fact Sheet Romania”, published by CEP-Research in December 2007. The market could growto a value of €200 million this year, the head of TNT Express Romania said recently.
DHL said that Cargus will remain a separate company with its own brand and product portfolio.Gian Sharp, managing director of DHL Romania, will lead the new joint management team whileAugustin Plesea, president of Cargus, will keep his position in the Cargus management board.Completion of the deal depends on approval from Romanian competition authorities and a fiscalaudit.
“Cargus has an excellent track record in the Romanian market which is based on businessculture similar to DHL’s can-do attitude. We expect DHL and Cargus to become the number one in theRomanian domestic courier market in terms of market size and quality of service”, Sharp said.
Both companies will further enhance their services through significant investments inoperational infrastructure and process improvement activities. While strengthening their leadingposition in each of their respective market segments, a single client interface will be developedto support a one-stop-shopping approach for the customers. “We want to offer our clients aconvenient and integrated access to domestic and international shipment services from a singlesource”, Plesea explained.
Cargus reportedly had turnover of €22.5 million last year while DHL Express Romania’srevenues were put at €28 million. Earlier this month, Plesea told Romanian media that Cargusexpected its turnover to rise 50% to some €45 million in 2008 thanks to an expanded serviceportfolio and larger network.
Cargus, set up 17 years ago, claims the most extended courier network in Romania, with morethan 90 offices and operational centres. With a fleet of over 600 vehicles and more than 1,700employees and co-workers, it offers domestic and international parcel and express distributionservices, and has more than 20,000 shipments daily.
