DP World has acquired 100 per cent of syncreon for an enterprise value of US$1.2 billion. This transaction is subject to customary completion conditions and is expected to close in 2H2021.
syncreon is a US-based global logistics provider that specializes in the design and operation of complex supply chains for the high growth automotive and technology industries, providing specialized value-added warehousing and distribution solutions through a variety of manufacturing, export packaging, transportation management, reverse/repair and fulfilment services.
syncreon has a global presence across 91 sites in 19 countries and services a large and diversified portfolio of customers made up of multinational companies. The group focuses on two key segments. Firstly, large technology customers to enable ecommerce and omni-channel fulfilment and aftermarket services, and secondly automotive companies for reception of materials, warehousing, inventory management, kitting/sequencing for line feeding, and export packaging.
This is complemented by a growing presence serving customers in consumer goods, healthcare and industrial markets. In FY2020, the group reported revenue of $1.1 billion with 57% generated in EMEA (predominantly Europe) and 42% in North America. syncreon has longstanding partnerships with customers averaging 18 years, and high contracts renewal rates.
Sultan Ahmed Bin Sulayem, Group Chairman and CEO, DP World, said: “We are delighted to announce the acquisition of syncreon, which adds significant strategic value to DP World given its strong logistics solutions capability, and will allow DP World to deliver end-to-end solutions to cargo owners.
syncreon’s complex solutions capability brings strong long-term relationships with cargo owners, which fits with DP Worlds vision to provide smart tech-led supply chain solutions to enable trade across key markets. The company’s exposure to the sizeable, fast-growing technology and automotive industries offers significant growth opportunities over the medium to long term. We aim to build on this platform to deliver greater scale and provide compelling value add supply chain solutions to cargo owners across a wider market.”
The acquisition will be funded from existing available resources. DP World continues to make positive progress on its capital recycling programs and remains fully committed to its leverage target of below 4.0x Net Debt/EBITDA by the end of 2022.
Brian Enright, CEO of syncreon, said: “We are excited to join the DP World group as we believe that syncreon will benefit from the group’s significant expertise in the wider supply chain and excellent relationships with cargo owners. We share the vision of serving our customers through removing inefficiencies and delivering value add solutions. While we have enjoyed great success over the years, we believe being part of DP World will enable us to take the business to other markets”.