DSV in $10bn NEOM logistics joint-venture deal with Saudi
Saudi Arabia has struck a multi-billion-dollar joint-venture deal with Danish freight-forwarding giant DSV to provide a full suite of ground, sea and air logistics services to the kingdom’s planned futuristic urban development project, NEOM.
NEOM is a planned 26,500-square-km (10,230-square-mile) high-tech region in northwest Saudi Arabia on the Red Sea that is expected to eventually house 9 million people, and which will be powered by renewable energy.
The joint venture with DSV – the world's third largest freight forwarder – will provide end-to-end supply chain management, development and investments in transport and logistics assets and infrastructure, as well as transport and delivery of goods and materials within NEOM, the parties say.
The partnership will focus on NEOM’s logistics services needs, with “unprecedented demand growing the joint venture and adding value to the local economy through services and jobs”.
The DSV initiative is designed to “drive innovation, leverage existing R&D efforts and further push commercialisation of new solutions and technologies”.
DSV-NEOM joint venture 'will create 20,000 jobs'
DSV added that NEOM “envisions unparalleled demand for construction logistics through to 31 December 2031, with sustained growth in non-construction logistics thereafter”.
NEOM will hold 51% of the joint venture and DSV 49%. The joint venture is expected to create an estimated 20,000 job opportunities.
Saudi Arabia's Crown Prince Mohammed bin Salman announced plans for NEOM in 2017 as part of his Vision 2030 reform plan, which aims to diversify the economy away from oil.
The kingdom's sovereign wealth fund, the Public Investment Fund, is the cornerstone investor in NEOM, on the Red Sea.
NEOM will include “hyper-connected cognitive cities”, as well as ports and enterprise zones, research centres, sports and entertainment venues and tourist destinations.
Jens Bjørn Andersen, CEO of DSV, said: "NEOM is one of the largest and most complex projects in the world. It provides a unique opportunity for us to support a development that is at the forefront of innovation, technology and digital transformation.
"We already have a strong presence in Saudi Arabia, and this is a significant growth opportunity for us in the region. We look forward to bringing our logistics capabilities to the table."
DSV, which employs 75,000 people in 80 countries, describes itself as a company that “keeps supply chains flowing in a world of change”, and who provides and manages supply chain solutions for thousands of companies, “from small family-run businesses to the largest global corporations”.
“Our reach is global,” it says, “and yet our presence is local and close to our customers”. It adds: "We work passionately to deliver great customer experiences and high-quality services, and aspire to lead the way towards a more sustainable future for our industry."
