SM Group buys 34.5% stake in 2GO parent firm
Conglomerate SM Investments Corp. (SMIC) has debuted into the logistics business by buying a 34.5-percent stake in the parent company of publicly-listed 2GO Group Inc., the country’s biggest integrated supply chain operator.
SMIC sealed a deal to acquire shares of Negros Navigation Co., which owns 88.31 percent of 2GO, from a certain fund. SMIC is expected to team up with the group of Phoenix Petroleum CEO Dennis Uy to form the controlling bloc in 2GO.
Uy, through holding firm Udenna Investments, earlier announced the acquisition of a 21-percent stake in 2GO Group via the purchase of shares held by Dutch firm KGL Investment B.V. (KGL-BV). Uy’s beneficial ownership in 2GO is estimated at 31 percent.
“We are pleased with this opportunity to invest in a fast growing, dynamic logistics business. It will benefit from, as well as contribute to the country’s economic progress especially as development spreads to the provinces” SMIC president Harley Sy said in a statement.
Earlier this month, when the company released its annual results, Sy had said the group was optimistic about broader regional growth with the government’s plans in infrastructure, agriculture and tourism.
Cora Guidote, SMIC’s chief investor relations officer, said that after doing its due diligence audit on 2GO, the SM group liked the business.
At this this time, she said SM was not yet thinking about 2GO’s potential synergies with the group’s core businesses.
Having a logistics arm is expected to make it easier for SM to roll out e-commerce businesses.
An integrated transport solutions provider, 2GO has three core business units, namely: 2GO Freight, which handles commercial and personal shipping needs; 2GO Travel, which integrates passenger ships and fast ferries through land and sea multimodal transport linkages; and 2GO Supply Chain, which handles logistics, distribution, warehousing, and inventory management.