MOL, Kintetsu World Express make carrier-forwarder alliance
Mitsui O.S.K. Lines, Japan’s second-largest shipping group, and Kintetsu World Express, the second-biggest forwarder in that country, today announced a strategic capital and business alliance backed by cross-shareholdings to combine their air forwarding, sea forwarding, and logistics businesses.
The alliance is believed to be the first carrier-forwarder alliance of this type in the industry, which has traditionally retained a separation between carriers and forwarders.
As part of the alliance, MOL will acquire a 5-percent stake in KWE, who in turn will acquire about 25 percent of MOL Logistics (Japan) Co. Ltd., the logistics arm of MOL.
MOL said the agreement with KWE will maintain the two companies’ competitiveness following the advent of the “mega integrators” such as Deutsche Post, FedEx and UPS.
MOL has 1.2 trillion yen ($11.1 billion) in annual revenue and employs about 7,000 people worldwide. KWE has revenue of 203 billion yen ($1.9 billion) and a staff of about 5,500.
MOL said the two companies will share overseas offices and agents, warehouse and transportation facilities as well as consolidating and expanding their IT capabilities to enable customers to build a “glass pipeline” of their inventory.
The deal paves the way for KWE to ship cargoes via MOL, while the carrier can use KWE’s network in China.
In early trading on the Tokyo stock exchange, MOL’s stock rose 1.5 percent to 629 yen, while KWE’s stock price was up 2.4 percent at 2,160 yen.