Hong Kong-based investor Emergevest is to target Britain’s logistics industry by creating what it says is the UK’s biggest private operator in the sector.
The private equity house is combining six British businesses which it has spent £400m acquiring over the past few years to form EV Cargo, a full-service business it says can compete against established major players.
Bringing together the six companies - Adjuno, Allport Cargo Services, CM Downton, Jigsaw, NFT and Palletforce - will create a single entity with revenues of £850m that employs 5,000 people out of almost 200 operations centres and 9m sq ft of warehouses.
Major customers are understood to include high street names including Asda, Sainsbury’s, Marks & Spencer and Next, as well as businesses including Dyson and Nestle.
Heath Zarin, chief executive of Emergevest and who heads EV Cargo, said combining the companies was the next step in further investment and potential acquisitions, with the aim to becoming a £1bn a year business within five years.
“We will be investing hundreds of millions in coming years and aim to double staff numbers,” he said, dismissing concerns that Brexit could mean the move comes at a bad time for UK industry.
“We don’t consider Brexit as a factor,” said the corporate lawyer turned investment banker. “From a business perspective it could present opportunities for acquisitions but we have a long-term strategy.
“The UK logistics sector is one of the most sophisticated in the world and we will seek to expand further internationally from here,” he added.
The creation the combined business will fuel speculation that Emergevest is lining up a flotation of EV Cargo to help fund expansion.
Mr Zarin said: “We are a long-term investor and our five-year plan will consider a range of financing options to raise additional capital, including an initial public offering.”
EV Cargo will run under four main operating segments: Express; Global Forwarding; Logistics and Technology. The four chief executives of each division – to be announced at a later date – are joined on the executive board by Zarin.
EmergeVest MD Simon Pearson becomes chief strategy officer. Mark Davis, secretary of NFT Distribution Financing, also serves on the executive board as general counsel.
- A core asset-based UK logistics network totalling 9 million sq ft of warehousing space and 20,000 trucks.
- A team of 5,000 UK based logistics professionals including 2,200 truck drivers.
- 175 UK operating centres and 18 overseas operations.
- An asset-light and technology-enabled global pallet delivery network comprising over 100 members.
- A multi-temperature 4PL freight-management service in the UK underpinned by 200 partner carriers.
- International supply chain management service powered by industry leading systems.
- International logistics operations managing c 200,000 TEU of sea-freight and c 60 million kg of airfreight.
- Multi-temperature storage and handling capability including hanging garments.
- Pallet, case and item level order fulfilment capability for B2B and B2C channels.
The Companies Involved
- Adjuno provides cutting-edge B2B cloud software solutions and supply chain management software that unites trading communities in the retail and consumer product industries.
- Allport Cargo Services is one of the UK’s largest freight forwarders with a global network and deep expertise in retail supply chain.
- CM Downton is one of the UK’s leading providers of ambient contract logistics services on behalf of many large-scale manufacturers across a range of industry sectors.
- Jigsaw is one of the UK’s market leaders in 4PL managed transport solutions through a network of partner hauliers.
- NFT is the UK's leading provider of temperature-controlled logistics services for fresh foods on behalf of manufacturers and retailers.
- Palletforce is the UK’s leading palletised distribution network consisting of a 100-strong membership of independent hauliers, based at the SuperHub in Burton upon Trent.
- EmergeVest is a Hong Kong-based international private equity investor with expertise in investing in international supply chain businesses. It has more than $450 million in committed capital and its financial and legal expertise, combined with hands-on knowledge of the logistics sector, has helped its portfolio businesses grow to the next level as part of a worldwide network of operations.