UPS Deal Paints China Brown

UPS acquires 23 Sinotrans centers in China

United Parcel Services (UPS) today announced a $100-million deal to acquire 23 China-based business centers from Sinotrans. The agreement signed on Wednesday will extend UPS’s service network across 200 cities, which combined account for 80% of China’s GDP, the package delivery company said.

Starting in January 2005, UPS will take direct control of operations in Shanghai, Guangzhou, Shenzhen, Tianjin, and Qingdao. By the end of 2005, UPS will complete its acquisition of the remaining 18 centers and will employ a total of 1,700 employees.

“This agreement opens a wealth of opportunity for UPS customers seeking to do business with China,” said David Abney, UPS International president. “UPS will have the flexibility it needs to expand operations and to invest in facilities, infrastructure, technology, and employee development.”

The deal will diminish Sinotrans’ role as freight forwarder for UPS in China— a relationship the two companies have had since 1988. At the helm of its own network, the package delivery giant intends to boost its own visibility by deploying its signature brown vans and uniformed workers across key cities among one of the world’s fastest growing economies.

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