Austrian Post has resolved a long-running dispute with the owners of Turkish parcel services company Aras Kargo and will increase its existing 25% stake to a majority 80% holding.
The Austrian postal group said it will spend a ‘mid double-digit million euro’ sum to take majority control of the Turkish company. The closing of the deal is expected in the coming weeks, subject to regulatory approval.
Baran Aras will continue to be a co-owner, with a 20% shareholding, and will also serve on the board of Aras Kargo.
Austrian Post initially acquired a 25% stake in Aras Kargo for €50 million in 2013. The value of this shareholding equalled €23.3 million as at 31 December 2019, according to the postal group.
Referring to the terms of the original agreement, Austrian Post said: “At that time, the basic intention and understanding with the Aras family, the founders and owners of Aras Kargo, was for Austrian Post to increase its shareholding. Such an agreement has now been reached.”
In fact, a dispute broke out between Austrian Post and the Aras family in 2016 when the postal group wanted to increase its stake to 75% by exercising a call option for an additional 50% holding. The Aras family rejected the move, claiming that it undervalued the company and also asserting that Austrian Post had failed to invest as originally planned.
The dispute then escalated in 2017 with legal proceedings by Austrian Post at the International Court of Arbitration in Geneva and by Aras Kargo in Istanbul, and a bitter public war of words between the two sides. Since then, however, there has been little public news about the dispute.
Aras Kargo is one of the leading Turkish parcel services providers, generating annual revenue of TRY 1,370 million (approx. €215m) in 2019 and transporting about 150 million parcels and documents per year.
According to its website, the company operates a network of 29 regional hubs and 900 branch offices, with a workforce of 14,000 employees and a fleet of more than 4,000 vehicles. In May 2019, Utku Ayyarkın, a long-serving sales and operations executive, was appointed as General Director of the company.
