Courier LBC Express Holdings Inc. (LBC) on Tuesday March 20, 2018 said it bought a minority ownership in a forwarding company and a controlling stake in a digital logistics firm that it plans to help in its push for its e-commerce.
The company in its disclosures to the Philippine Stock Exchange said it bought 30 percent of Orient Freight International Inc. (Ofii), a freight forwarding, cargo handling and management company, for about P218.83 million.
“This is a strategic investment for LBC as we continue to move toward expanding our business and maintaining our No. 1 position in the industry. Having a stake in Orient will yield LBC enhanced economies of scale, while also achieving improved cost efficiency in certain subsectors of our business, where we see a great deal of growth prospects. In particular, Ofii is well-entrenched in brokerage, cold chain, automotive logistics, warehousing and distribution centers, and project logistics—we look forward to working together and growing these sectors for both companies,” Mike A. Camahort, the company’s CEO, said in a statement.
LBC said it will purchase some 1.15 million shares of Orient Freight for P63.43, or a total of P72.94 million. LBC will then subscribe to 3.28 million common shares out of the unissued capital stock of the forwarding firm for P44.40 apiece or a for a total of P145.88 million.
The consideration of the purchase is based on fair market value.
Orient Freight was established 44 years ago, and is now one of the leading freight forwarder and cargo handlers in the Philippines and in Southeast Asia.
Meanwhile, LBC said it is acquiring 86.11 percent of Quadx Inc., a digital logistics company established in 2013.
The said acquisition is part of the Araneta family’s plan to consolidate affiliate businesses both within the Philippines and across the globe.
QuadX was established to create digital logistics platforms and solutions, to “disrupt and incubate” traditional logistics processes. It has led to successful product launches of e-commerce platform Shipping Cart, Check Me Out and XPost. To date, these widely used digital platforms are both market leaders.
LBC did not disclose its acquisition price for Quadx.
Last year QuadX transaction volumes grew more than fourfolds with 280,000 average monthly transactions in the first quarter, and ending the year with 1.2 million average monthly transactions in the fourth quarter.
In 2016 it processed 860,000 total transactions, an eightfold increase from 2015.
QuadX is currently operating eight hubs, and employs 1,200 delivery couriers or riders. On top of its extensive retail customer base, QuadX also serves more than 25,000 merchants, comprised mostly of small and medium enterprises.
LBC is the Philippines’ market leader in payments & remittance, documents & mail, parcels & boxes, and cargo & logistics. With a growing network of over 6,400 locations, partners, and agents in over 30 countries, LBC is committed to moving lives, businesses, and communities and delivering smiles around the world. Founded in 1945 as a brokerage and air cargo agent, LBC pioneered time-sensitive cargo delivery and 24-hour door-to-door delivery in the Philippines. Today, it is the most trusted courier, cargo & logistics, and remittance service provider of the Global Filipino.