FedEx Corp. agreed to buy a chunk of Supaswift Ltd., its Southern African service provider in South Africa, Malawi, Mozambique, Swaziland and Zambia, and the world’s largest air-cargo company is also considering buying businesses in Botswana and Namibia, according to a report in Wall Street Journal.
The acquisition will provide FedEx customers better access to some of the world’s most rapidly growing economies, said FedEx CEO Frederick W. Smith in the Wall Street Journal report. “It is an important step in our international growth strategy and further strengthens our FedEx Express portfolio.
FedEx issued a muted financial outlook Wednesday, saying it plans to ground more express flights between Asia and the U.S. in July, the report said. The company is dealing with a shift by international shipping customers away from priority service to cheaper options, Wall Street Journal reports. The company’s quarterly earnings surpassed Wall Street expectations despite restructuring costs.
The Southern Africa acquisition will give FedEx Express direct access to seven markets through 39 facilities and the deal will include about 1,000 Supaswift employees joining 300,000-plus FedEx employees world-wide, the report said. The new acquisitions will operate under FedEx Express.
Supaswift started doing business in South Africa in 1990 and has offered FedEx Express international services in Southern Africa since 1991.
FedEx has been active in Africa since the early 1990s, the report says.