UPS has completed the acquisition of Andlauer Healthcare Group, a provider of logistics and refrigerated transportation services for the healthcare sector in Canada, for $1.6 billion in cash, the company announced Monday.
Andlauer’s customers include companies that make pharmaceuticals, vaccines, biologics, blood products, nutraceuticals, medical devices, consumer healthcare, animal health, and health and beauty products.
Michael Andlauer, founder and CEO of AHG, will lead UPS Canada Healthcare and AHG, UPS said. Publicly traded Andlauer will be delisted from the Toronto Stock Exchange.
“The addition of Andlauer’s capabilities will further strengthen our solutions in global health care logistics, particularly in North America,” UPS CEO Carol Tomé said on the company’s earnings call last Tuesday.
UPS (NYSE: UPS) is focusing resources on the healthcare sector, where value-added services and customized solutions for highly sensitive products allow the company to charge premium rates, unlike the core domestic parcel business where yields are often low and volumes are softening. Global third-party logistics providers, including FedEx and DHL, are also aggressively expanding their healthcare logistics portfolios.
UPS last year said it plans to double revenue in health care logistics to $20 billion through organic growth and acquisitions by 2026.
With the addition of Andlauer’s’s specialized cold chain network and expertise, UPS Healthcare customers will benefit from reduced transit times, enhanced end-to-end visibility, and deeper global reach, UPS said.
Nearly 60% of Andlauer’s revenue comes from temperature-controlled ground transportation, where it uses a blend of owner-operated and employee drivers for courier and less-than-truckload service under brands such as ATS Healthcare, Boyle Transportation and Skelton Truck Lines. Partner companies in warehousing and distribution include Accuristix and Logistics Support Unit, according to Andlauer’s website. The Canadian company also provides specialized packaging services and airfreight forwarding.
In September, UPS had to abandon its planned purchase of Mexican courier Estafeta after the sides couldn’t meet closing conditions.
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