DHL Supply Chain, Aramco form JV for procurement and logistics hub
The joint venture that aims to be operational by 2025 would first concentrate on Saudi Arabia, with plans to extend throughout the MENA region.
Aramco, one of the world's leading integrated energy and chemicals companies, and international contract logistics provider DHL Supply Chain have announced the signing of a shareholders' agreement for the establishment of a new Procurement and Logistics Hub in Saudi Arabia, with the goal of improving supply chain efficiency and sustainability. It would be the first such center in the area, serving customers in the industrial, energy, chemical, and petrochemical sectors.
The joint venture aims to be operational by 2025, offering dependable end-to-end comprehensive procurement and supply chain services to enterprises in the industrial, energy, chemical, and petrochemical sectors. The combined business would first concentrate on Saudi Arabia, with plans to extend throughout the Middle East and North Africa (MENA) region.
The joint venture is anticipated to bring value in satisfying customers' supply chain buying, warehousing and inventory management, transportation, and reverse logistics needs by leveraging Aramco's leading energy and industrial supply chain ecosystem and DHL's world-class logistics experience.
Amin H. Nasser, President & CEO, Aramco said, "This partnership brings together two industry leaders, each with long and storied histories. By combining the exceptional energy, chemicals and industrial supply chain ecosystem of Aramco with the world-class shipping and logistics expertise of DHL, we aim to enable the Procurement and Logistics Hub joint venture to serve as a one-stop hub for customers' supply chain needs. We anticipate that it will not only advance the economic goals of our two companies but also accelerate growth across Saudi Arabia and the MENA region."
The aim is for the joint venture to achieve industry best practices in procurement and supply chain management, as well as the deployment of more sustainable supply chain, transport and warehousing solutions.
Oscar de Bok, CEO, DHL Supply Chain said, "Through it, DHL intends to foster its business operations and logistics networks throughout Saudi Arabia and the MENA region while expanding our industrial footprint. By working in partnership with Aramco, we aim to provide regional and multinational businesses from these sectors access to a robust international logistics network, fostering positive economic growth while promoting sustainable activities."
The joint venture is anticipated to enable organizations to decrease costs, enhance productivity, and capitalize on digitalization by utilizing cutting-edge technology. It is the conclusion of several years of collaboration between the two companies, with the goal of transforming inventory and logistics management, expanding the company, creating employment, and enabling economic diversification in Saudi Arabia and the MENA region.
The joint venture's creation is subject to regulatory clearances and other customary closing conditions.