Source: DHL
DHL eCommerce has entered into a joint venture with AJEX Logistics Services to acquire a minority stake in the Saudi Arabian parcel logistics firm.
The e-commerce division said the deal would allow it to enter into the “rapidly growing” Saudi Arabian e-commerce parcel market.
"Although AJEX only began its operations in 2021, it has already established itself as a leading parcel service provider in the rapidly evolving domestic market, with robust growth and an extensive distribution network,” DHL said.
AJEX, which is backed by investment firm Ajlan & Bros Holding, employs 1,500 people and provides domestic parcel processing and delivery through a network that includes over 50 facilities and a fleet of more than 900 vehicles.
Following the deal, DHL eCommerce will contribute its expertise and have representation on the management board. It also has the option to increase its interest to a majority stake in the future.
DHL eCommerce chief executive Pablo Ciano said: “As a key component of our corporate Strategy 2030 ‘Accelerate Sustainable Growth’ we are focusing on markets like Saudi Arabia that exhibit significant growth dynamics and strong economic development.
"We are confident that AJEX, with its commitment to quality and strong customer focus, supported by a highly motivated team and backed by Ajlan & Bros Holding, is the perfect partner to help us expand our e-commerce-focused parcel business into this booming market."
While the Saudi Arabian market is new to DHL eCommerce, the overall DHL Group has had a presence in the country since 1970 through its DHL Express business unit.
DHL's other divisions have also been operating in the country for several years, providing services such as contract logistics and freight forwarding solutions.
“Saudi Arabia is dedicated to fostering economic growth and diversifying its industries under Vision 2030 with logistics serving as one of the key pillars," said Ajlan Bin Mohammed Al Ajlan, group managing director of Ajlan & Bros Holding.
"In this context, we are also witnessing strong growth in e-commerce, which in turn is driving expansion in the domestic parcel sector. The demand for a parcel service provider with local expertise and a global network is steadily rising."
The deal is awaiting regulatory approval.
Earlier this year, AJEX announced a partnership with Chapman Freeborn to offer airport ground and cargo handling and management of special cargo projects.
