JG diversifies into logistics in JV with DHL

Gokongwei group-led conglomerate JG Summit Holdings is diversifying into the logistics business, including warehousing and last-mile delivery, through a brand-new partnership with global logistics giant Deutsche Post Beteiligungen Holding GMBH (DHL).

JG Summit, DHL and Accrain Holdings Corp. signed a deal to create a joint venture called DHL Supply Solutions Inc. (DSSI), seeking to provide what they envisioned to be “best-in-class” transport and distribution solutions for Philippine-based and international businesses.

Targeted to start commercial operations by 2020, DSSI will engage in the business of providing domestic transportation, logistics, warehousing and distribution of cargoes and other supply chain management activities.

DSSI is also seen to unlock synergies with other businesses of the Gokongwei group that could be taken into the e-commerce space. The group is one of the leading players in retailing through Robinsons Retail Holdings Inc. (RRHI) and has interest in some digital ventures.

“The Philippines economy is expected to grow by 6 percent year-on-year and businesses will need to invest in world-class logistics and warehousing services to stay ahead of the competition,” Lance Gokongwei, JG Summit president and chief executive officer, said in a disclosure to the Philippine Stock Exchange on Tuesday.

“With our diverse business portfolios and local networks, we are committed to help homegrown and international companies in the Philippines achieve their next phase of growth. Working with DHL is the ideal move for us, as we leverage their global footprint and tap onto their expert knowledge to provide integrated industry-leading services,” Gokongwei added.

Terry Ryan, CEO at DHL Supply Chain for Asia Pacific, said: “We are seeing greater investment by the government on enhancing infrastructure such as setting up integrated logistics and industrial parks, and customers can count on our expertise in this aspect to serve their needs. Our global network and local expertise puts us in good stead as the most reliable logistics partner they need, to fully capitalize on the market opportunities.” INQ