2GO absorbs logistics subsidiary
Logistics firm 2GO Group Inc. announced plans to absorb wholly-owned subsidiary Special Container and Value Added Services Inc. (SCVASI) as part of its internal restructuring to improve cost efficiency.
In a disclosure on Tuesday, the listed company said its board of directors approved on Feb. 22 the merger of 2GO and SCVASI, with the parent firm as the surviving entity.
“The merger will simplify the corporate structure and develop efficiencies and economies within the 2GO Group. This is in line with 2GO’s efforts to streamline operations, reduce costs and increase shareholder value,” the SM Investments Corp. subsidiary said.
The merger is subject to approval by the stockholders of both companies and the Securities and Exchange Commission.
The timeline of the transaction also depends on the go signal from regulators.
SCVASI provides a wide range of services, including in-land and domestic freight reefer transportation, reefer van lease and maintenance and cold storage.
Last year, 2GO earned profits amounting to P312 million, a turnaround from P1.14-billion net losses in 2021. Its recovery was supported by the reopening of the economy that has allowed more passenger and cargo movement.
Article continues after this advertisementImproved revenues
Total topline figures grew by 25 percent to P19.3 billion for the period. “Improving market conditions aided volume momentum in shipment of goods while the holiday season boosted passenger numbers,” 2GO explained.
Article continues after this advertisementRevenues from logistics and other services were driven by growth in cold chain services, forwarding, e-commerce fulfillment and international courier segment.
“Our 2022 growth was the result of high demand for our services with the opening up of the economy while our increased profitability was also driven by the structural changes and financial discipline we have put in place,” 2GO president and CEO Frederic DyBuncio said.
2GO invested in automated sorting and transport management systems to better handle operations amid rising demand for its services. It also acquired two roll-on/roll-off passenger vessels as part of its fleet modernization plan.
