Singapore-listed Cosco has proposed to spend MYR88m ($21m) to acquire 80% shares in each of the Malaysian companies: Guper Integrated Logistics, Gem Logistics, Dolphin Shipping Agency, and East West Freight Services.
The Chinese firm will also spend up to MYR10m to acquire assets by SH Cogent Logistics from Golden Logistics & Storage, as well as lease of land at Port Klang to construct a warehouse of approximately 300,000 square feet.
Cosco’s subsidiary Cogent Malaysia is in discussion with Westports Malaysia to firm up the land lease in Port Klang.
There has been a long term shortage of quality warehousing facilities in Port Klang and an underlying customer demand for new warehousing facilities, Cosco noted.
This project is expected to fulfil current market demand and allow Cogent Malaysia to capitalise on the competitive advantage it possesses in its main business of container transportation, and to expand both the upstream and downstream services of container transportation business.
“Upon completion of the above transactions, the company will be able to create a consolidated platform to provide our customers with a one-stop integrated service, which will be expanded to include container haulage, freight forwarding, container depot and warehousing,” Cosco stated.
“Moving forward as an integrated platform, the group expects to benefit from potential synergies and economies of scale, by engaging in cross-selling of services and business optimisation with its related companies,” Cosco said.