Deutsche Post DHL Group and SF Holding complete $790mn deal to launch SF DHL Supply Chain China

A US$790mn deal bringing together Deutsche Post DHL Group (DPDHL Group) and SF Holding has been completed, creating a 10-year strategic partnership designed to grow supply chain operations in China.

Under the terms of the deal, DPDHL Group will transfer its supply chain operations in Mainland China, Hong Kong and Macau to SF Holding. SF will inherit the supply chain business and will operate under a co-branded business called – SF DHL Supply Chain China.

Yin Zou, the former CEO of Greater China of DHL Supply Chain, has been appointed as CEO of the new business and will look to “harness DPDHL Group’s best-in-class supply chain management expertise, transportation and warehousing technology, combined with SF's extensive domestic infrastructure, distribution network and broad base of local customers, to drive its growth trajectory.”

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DPDHL received a payment of RMB 5.5 bn ($790mn) and will receive revenue-based partnership fees for 10 years.

“This supply chain alliance with SF is a strategic milestone for DPDHL Group. With our joint capabilities we will create a unique platform to meet the need for a high quality end-to-end supply chain provider in China. SF's local market expertise combined with DPDHL Group's global operations standards and network support provide a solid foundation for us to continue exploring further opportunities in China in the coming years. China is on course for sustainable growth1, and SF DHL Supply Chain China is well-placed to serve the increasing demands for world-class supply chain services. The agreement, therefore, is the cornerstone for DPDHL Group to gain unprecedented access to China's immense domestic market," said Frank Appel, CEO Deutsche Post DHL Group.

"SF's vision is to become a trustworthy logistics-based business partner with comprehensive solutions for our customers, and our partnership with DPDHL, the leading logistics company in the world, helps us move solidly ahead with this vision. We are expanding our domestic footprint through SF DHL Supply Chain China to cater to our customers across a multitude of industries. This deal with DPDHL Group, a world-class organization, also helps us to better serve multi-national clients," said Dick Wong, Chairman, SF Holding.