Singapore Post is buying a majority stake in US-based Jagged Peak to create a ‘global’ e-commerce logistics network by ‘connecting the dots’ in Asia, Australia, Europe and North America.
In a deal announced today, SingPost will buy a 71.1% equity stake in Jagged Peak, which had revenues of approximately US$61.7 million in 2014, for US$15.8 million. The US company’s founders and directors Paul and Primrose Demirdjian will retain a joint 28.9% holding.
SingPost, which aspires to build an end-to-end e-commerce logistics network and technology platform, said it will thus have a ‘global’ footprint, linking the continents of Asia, Australia, continental North America and Europe.
The US acquisition is the latest in a series of M&A deals by Singapore Post under the management of Wolfgang Baier and following Alibaba Group’s acquisition of a 15% stake in the group. SingPost subsdiary Quantium Solutions is being transformed into a joint venture with Alibaba to provide e-commerce logistics in Asia Pacific and beyond. Over the last few years, the group has acquired or bought stakes in courier and logistics firms in Australia, Hong Kong, China (Shenzhen) and several other regional markets.
Lim Ho Kee, Chairman of SingPost, said: "As SingPost pioneers and leads e-commerce logistics in Asia Pacific, we are casting our eyes beyond the region. Jagged Peak can enable end-to-end fulfilment of e-commerce orders across the US. SingPost is excited about this capability. This transaction is also part of our strategy to focus our resources on strengthening our geographical reach and the technology we employ as an e-commerce logistics company."
Wolfgang Baier, Group Chief Executive Officer of SingPost, added: “This acquisition will ‘connect the dots’ and make our e-commerce logistics network global. The acquisition of Jagged Peak allows us to use their state-of-the-art e-commerce omni-channel technology to enable brands and retailers not only to leverage their warehouse facilities in over 20 locations in the US but expand these services into our Asia Pacific warehouse network. A win-win for existing and future customers. We have planted the seeds with this investment of what will be SingPost’s global multi-channel B2B4C e-commerce logistics platform.”
Jagged Peak CEO Paul Demirdjian, who founded the company in 2000, commented: "SingPost's investment in Jagged Peak is evidence of a new era of e-commerce where global infrastructure and fulfillment needs are becoming the new norm. This merger is an exciting opportunity that will allow us to provide retailers and consumer brands with an end-to-end worldwide solution.”
Outlining the benefits of the deal, SingPost explained that Jagged Peak’s proprietary and accredited e-commerce logistics platform, utilised by more than 20 warehousing facilities across the US, Canada and Europe, will enable it to become a truly global e-commerce logistics provider for high-velocity consumer products.
The proposed acquisition will enable SingPost to support customers globally and move products more efficiently to consumers by implementing Jagged Peak’s Flexnet technology. There is also opportunity to realise synergies by leveraging Jagged Peak’s omni-channel e-commerce and order management platforms.
Looking ahead, SingPost added that it intends to invest in Jagged Peak’s e-commerce logistics infrastructure, processes and technology to help customers maximise their business potential globally. “SingPost’s now global e-commerce logistics and technology infrastructure will enable SingPost customers to grow not only across Asia Pacific but expand into the US and beyond seamlessly with one e-commerce logistics solution provider.”
