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GEFCO,
French-based but mostly Russian railway-owned
auto motive logistics group, is looking
to more than double its revenue in global
forwarding after its acquisition of IJS
Global, said company chairman Luc Nadal.
"Purchasing
IJS added EUR160 million [US$181.7 million]
to Gefco's freight forwarding turnover,
raising it to EUR400 million annually,"
said Mr Nadal. "The target is to increase
this to EUR1 billion by 2020, which we think
is a realistic target, achievable through
organic growth and acquisitions."
This
will enable Gefco, which is 75 per cent-owned
by Russia's state railway, RZD, to diversify
into other business lines, tap new markets
and provide value-added services, he said.
The
rationale behind the purchase of IJS had
been primarily to complement Gefco's own
network and by so doing to build a network
worldwide, writes Stuart Todd in Lloyd's
Loading List.
"The
two firms are complementary both in terms
of business lines and geographical presence,"
said Mr Nadal. "Apart for some work
in China, there's no 'duplication.
"These
customers are major players in their field,
notably in the automotive industry but also
in other sectors, who are looking for service
providers who can offer tailored solutions
on a global scale.
"Ideally,
customers don't want to have to deal with
several different forwarders and, until
now, in certain situations, Gefco has not
been in a position to offer the one-stop
provision they are seeking. This changes
with the acquisition of IJS," he said.
IJS
gives Gefco a foothold in the US and in
countries such as Australia, Thailand, Singapore
and Taiwan, as well as substantially strengthening
its presence in the UK, Germany, the Netherlands,
China and Hong Kong, Mr Nadal said.
"With
an expanded geographical coverage, we now
consider ourselves to have the necessary
attributes to aspire to the rank of global
player in freight forwarding and as such
achieve the kind of buy rates and access
to capacity that our customers require."
But
he is under no illusion that with the acquisition
of IJS and the projected growth to come,
Gefco will attain the size of a top player
in forwarding.
"This
is not our main intention. There is a kind
of 'Premier League" of eight to ten
forwarders, followed by a second division
where we are among the first," he said.
"Our
size allows us to think in terms of customers'
individual requirements rather than offering
standardised solutions."
Asked
if he thought Gefco continued to have weak
spots in its network following the acquisition
of IJS, notably in the US, Nadal replied:
"The
US may well have been a weak spot pre-IJS
as Gefco didn't have its own base there
- only a commercial team in proximity to
our key account customers, notably in the
automobile and oil & gas. With IJS,
we are now going to operate in the US under
our own team with our own structure. It's
a bridgehead.
"Admittedly,
turnover is fairly modest at the moment
and if we see an opportunity to acquire
a firm [in the US] that we consider to be
complementary to IJS, we could take it.
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