UPS buys out Japanese venture partner
United Parcel Service, the Atlanta-based provider of package delivery and supply chain services, said that it will acquire the minority shareholding held by its its joint-venture partner in Japan, Yamato Transport Co.,.
Effective April 1, UPS Yamato Express Co. will become a wholly owned company of UPS.
UPS and Yamato Transport Co. will continue their cooperation in the Japanese express market. The acquisition gives UPS the flexibility to invest in new facilities and technology, UPS said in a statement.
The deal is significant because it gives UPS more autonomy to expand its brand in the Japanese market by setting up its own stand-alone package shipping business rather than being required by the joint venture agreement to use Yamato as its ground delivery service provider. The UPS colors and logo will now adorn the company’s trucks instead of sharing truckside space with Yamato’s symbol of a black cat, UPS spokesman John Wheeler said.
UPS has not exactly decided in what way it will use Japan’s top parcel carrier for domestic deliveries, but under the new relationship Yamato will act more like an agent under contract to UPS, Wheeler explained.
In many countries, UPS operates its own network in large urban areas and outsources deliveries in rural areas to agents, who contract with several companies to handle deliveries, Wheeler said, emphasizing that it was too soon to say whether Japan would follow such a scenario.