August 09, 2022: – United Parcel Service Inc declared on Monday it would acquire Italy-based healthcare logistics firm Bomi Group to strengthen its ability to deliver medicines that need cold storage.
The U.S. delivery firm is concentrating on high-margin businesses to offset falling volumes as the pandemic-fuelled e-commerce increase lessens, having expanded its temperature-controlled supply-chain logistics to help the deployment of COVID-19 vaccines worldwide.
Established in 1985 in Milan’s Lombardy region, Bomi Group assists healthcare providers with warehousing and logistics for sensitive pharmaceutical products throughout Europe and South America.
The deal will “greatly improve our healthcare customers’ ability to persist in developing and deliver life-saving innovations,” UPS expressed in a statement.
Atlanta-based UPS did not reveal financial details of the transaction, but the Wall Street Journal, which first wrote the news on Sunday, voiced it was for several hundred million dollars.
Two sources nearest to the matter told Reuters the deal was anywhere between $500 million and $1 billion.
The world’s most well-known package delivery firm expects to include more than 350 temperature-controlled vehicles and four million square feet (0.37 square kilometers) across 14 countries from the agreement.
“While a relatively small agreement for UPS, interest in the emerging region of healthcare logistics remains strong even as the world progresses on from the pandemic,” stated Peter McNally, Global Sector Lead for Industrials Materials and Energy at research company Third Bridge.
As per the filings, Europe is the largest region outside of the United States where UPS operates, accounting for nearly half of the company’s international package segment revenue last year.
Bomi’s CEO Marco Ruini will continue to head the Italian firm after the deal, UPS stated, adding that Bomi’s workers would continue in the collaborative organization.
JPMorgan served as the sole adviser to UPS.