UPS CREATES NEW FORWARDER-BROKER UNIT
United Parcel Service, the Atlanta-based express and package delivery giant, said on Thursday that it has formed a new business'entity that combines a number of recent acquired companies into one global customs brokerage and freight forwarding unit.
UPS has appointed David Abney, former president of SonicAir, to lead the new subsidiary, which comprises the Fritz Cos., seven brokerage and forwarding businesses bought by UPS over the last 18 months, as well as UPS’s current freight forwarding operations.
The combined units have reported net revenues of more than $750 million.
“Long before the purchase of Fritz, UPS developed a strategic plan (to expand) services for customers shipping not only packages, but also large items and heavy freight across international borders,” Abney said.
“That plan also called for the company to offer customs clearance services to shippers of all goods, not just those shipping small packages,” he explained.
In addition to Fritz, the other acquisitions forming UPS’s new business unit include H.A.& J.L. Wood Inc., of Pembina, N.D.; Border Brokerage Co. of Blaine, Wash.; Fulfillment Systems International of Buffalo, N.Y.; Trans-Border Customs Service of Champlain, N.Y.; W.Y. Moberly Inc., of Sweetgrass, Mont.; the Miles Group Inc., of El Paso, Texas; and William F. Joffroy Inc., of Nogales, Ariz.
The new subsidiary also includes existing freight forwarding operations Unistar USA, Atlas Air of the United Kingdom and UPS Italia.
UPS also that that Fritz's shareholders approved UPS's acquisition, at a special meeting on Wednesday.
Shares of issued and outstanding Fritz stock was converted into the right to receive 0.2 of a share of UPS Class B common stock. The total value of the transaction is about $437 million, based on Wednesday’s UPS closing price.
Fritz stock was delisted from the Nasdaq at the close of business yesterday.
Abney is a 27-year UPS employee, including serving as president of SonicAir, which is now part of the UPS Logistics Group.
UPS said the new business unit “is not expected to have a material impact on UPS’s earnings this year.”