OREANDA-NEWS. May 07, 2008. Itella will acquire National Logistic Company (NLC), the leading  warehousing service provider in the Russian logistics market, reported the press-centre of RosEvroBank.

The deal will reinforce Itella Logistics’ position as one of the leading logistics operators in Northern Europe and make it a one of the market leaders in the rapidly growing Russian logistics market. In future, Itella Logistics will provide logistics services throughout Russia via its extensive logistics centre network and transport connections. With a staff of 6,000, NLC’s net sales for 2008 will be around EUR 180 million. The completion of the acquisition is subject to the approval of the Russian competition authorities.

NLC is Russia’s leading warehousing service provider, and one of the few operators with a comprehensive logistics centre network, covering not only Moscow but also 6 other major cities in Russia. The firm is experiencing intensive growth: at the end of this year, it will have some 600,000 square metres of warehousing space, including 230,000 square metres in its own premises. In addition to warehousing, NLC’s services comprise transport and deliveries in Russia, complemented  by Itella Logistics’ comprehensive global land, sea and air freight services.

Comprehensive warehouse logistics and transport network in Russia
The service portfolio and customer business lines of Itella Logistics and NLC are highly similar.

NLC’s customer base comprises international manufacturers and retail chains of daily and special goods, pharmaceutical companies and Russian trade firms.

“Russia’s intense economic growth is boosting demand for logistics services. For instance, last year demand for warehousing space in Moscow outstripped supply many times over. Through NLC, we will gain a strong competitive advantage as a provider of global logistics solutions. We will also be able to provide the most comprehensive network of logistics centres and transport services in Russia, for Finnish and international customers,” comments Mr. Vertanen, Senior Vice President, Itella Corporation.

“During the last years NLC was growing up rapidly almost doubling its operations each year.

Our principal objective of integration with Itella is to achieve a new superior level when we’re providing clients with even more innovative and technologically enhanced solutions, and therefore to reinforce and extend our leading positions,” comments Mr. Artemenko, Vice President, National Logistic Company.

In 2006, Itella Logistics established its own service operations in Russia. Last year, a 20,000 square metres warehouse was opened in Moscow. In 2008, Itella  expanded its category ‘A’ warehouse facilities in Moscow up to 40,000 square meters and will open a new warehouse in St. Petersburg in May.

The sellers are RosEvroGroup and investment funds managed by Citigroup Venture Capital International (CVCI).  RosEvroGroup will continue as minority shareholders with a share of 10 per cent in contact logistics and will keep full control over customs clearance and brokerage business. The purchase price of the transaction is approximately EUR 200 million.

Finland-based Itella Group (former Finland Post Corporation) has three main divisions – mail delivery, logistics and information logistics. In 2007, the total sales of the group were EUR 1,7bn and it employees 25,600 people. Itella has operations in 10 European countries. The group is owned by the Finnish state. As a part of Itella Group Itella Logistics is a service logistics provider based in northern Europe, operating globally through partners. Its services include transport services, forwarding, contract logistics, consulting and IT-based logistics solutions. In 2007, Itella Logistics generated net sales of EUR 620 million and employed 4,350 staff in eight countries.