Aramex

Aramex
Public (DFM: ARMX)
Industry Transportation and logistics
Founded 1982 (1982)
Headquarters Dubai, United Arab Emirates
Key people
 Fadi Ghandour (Founder)
Hussein Hachem (CEO)
Products International, Express,
Domestic Express,
Freight Forwarding,
Logistics, Shop & Ship,
Catalog Services
Revenue Increase $993.62 million (2014) [1]
Increase $94.46 million (2014)[1]
Slogan Delivery Unlimited
Website www.aramex.com

Aramex (Arabic: ارامكس ’arāmaks) is an international express, mail delivery and logistics services company based in Dubai, United Arab Emirates (UAE).[2] The company was founded by Jordanian Fadi Ghandour and Bill Kingson in 1982.[2][3][4] It is the first Arab-based company to be listed on the NASDAQ stock exchange.[2][5][6] Aramex is listed on the Dubai Financial Market.[6][7] Hussein Hachem serves as the company's CEO.[8] Aramex has approximately 13,800 employees in 54 countries and a network consisting of 40 independent express companies.[6]

Thomas Friedman profiled the company in his book, The World Is Flat.[2][9]

History

Fadi Ghandour co-founded Arab American Express shortly after receiving his BA in political science from George Washington University, with his business partner, Bill Kingson in 1982.[2][3][5][6] Kingson, a friend of Ghandour's father and owner of a small courier company in the New York tri-state area, discussed the business with Fadi Ghandour after he had expressed interest in the business.[2][5] After their discussion, Kingson proposed a partnership to establish a courier business in the Middle East with Ghandour.[2]

The company began operations in Amman, Jordan.[2][3][5] Arab American Express aimed to become the first courier company in the Middle East.[2] At the time there were no international courier companies based in the region because of logistical and bureaucratic challenges caused by civil wars and complex political relationships.[2][3][5] The company's first international delivery was a document for the Housing Bank for Trade and Finance based in Jordan to New York City.[2] Within two years, the company's name was shortened to Aramex.[3]

In 1984, the company's operations were less than $1 million in revenue.[3] Aramex offered Airborne Express 50% ownership of the company for $100,000, that year.[2][3] Airborne Express declined the offer because it did not have the resources to invest in a small market such as the Middle East.[3] The partnership made Aramex responsible for Airborne's business in the region.[3] Aramex moved its headquarters to Dubai, United Arab Emirates in 1985.[2]

Aramex gained Federal Express as a client in 1987.[2][3] In the first year of partnership, 30% of Aramex's revenue came from packages originating from the Federal Express network.[2] Airborne Express acquired 9% of Aramex for $2 million.[2] Aramex was listed on the NASDAQ stock exchange in January 1997.[5][7] The company became the first Arab-based company to trade its shares on an American stock exchange.[2][5] Aramex's valuation was $24 million and the IPO raised $7 million.[2] The company accrued $66 million in revenue and $31 million in gross profit that year.[2]

The company expanded its operations to 120 locations in 33 countries, primarily emerging markets in the Middle East and Southeast Asia by 2001.[2] The company's strategy was to enter high-growth markets characterized by high populations and liberalizing economies.[2] During summer 2001, Abraaj Capital, the first private equity firm in the Middle East, proposed Aramex a leveraged buyout offer that would take the company off of the NASDAQ stock exchange.[2][6][7] The deal was accepted and Abraaj Capital acquired the majority of Aramex for $65 million in February 2002.[2] The deal allowed Kingson and Airborne to exit, while Ghandour retained 25% of the company and management control.[2] Abraaj acquired 75% of Aramex and made 6% of its shares available to company employees in the form of stock.[2] Between 2002 and 2003 Aramex's net income rose from $4 million to $10 million.[2]

In 2003, DHL acquired Airborne Express, Aramex's main United States partner. This resulted in Airborne Express exiting the Airborne Alliance. In the same year, Aramex took over the alliance and co-founded the Global Distribution Alliance (GDA), a global alliance of 40 express companies with combined revenues of $7.5 billion. Aramex is chairing the alliance which uses a shipment management system developed by the company.[10][11][12]

Aramex went public on the Dubai Financial Market in February 2005.[2][6][7] The IPO raised $270 million.[2] The company's revenue increased 23% over 2004 and net income increased 56% that year.[2]

As part of its expansion plans, Aramex concluded a series of acquisitions, including Priority Airfreight, InfoFort, Freight Professionals and TwoWay-Vanguard.[13][14][15]

World-renowned writer and columnist Thomas Friedman used Aramex in his book, The World Is Flat, as an example of companies that benefit from what he calls the flattening of the world.[2][6][9][16] The flattening of the world is the leveling of the economic field and the destruction of "barriers to entry," opening the door wide for an individual or a company anywhere in the world to collaborate or compete globally.[16][17][18]

Expansion

In February 2011, Aramex acquired OneWorld Courier and In-Time Couriers, two Kenyan courier firms.[19] Aramex acquired Berco Express, a South African logistics firm in December 2011.[20] PayPal partnered with Aramex in 2012.[21] The partnership gave PayPal credibility in the Middle East, while opening up new markets abroad for Aramex.[21] Aramex developed REDe, a solution aimed at enabling companies to begin selling their products online, in early 2012.[22] ShopGo, an e-commerce solution, released Aramex Suite in August 2013.[23] The module enabled e-commerce stores to automatically access several of Aramex's services.[23]

Aramex launched Aramex Bio, a medical courier service in March 2014.[24] The service was launched in the Middle East and North Africa.[24] In June 2014, Aramex acquired Mail Call Couriers, an Australian courier service.[25]

Sustainability

The company supported the Ruwwad Al Tanmeya initiative in 2006. The initiative aimed to involve the private sector in spurring community development through youth empowerment and investments in the community through education, civic engagement and volunteering.[26] Aramex has a twenty percent stake in Ruwwand Al Tanmeya.[27]

Aramex became the first company in the region to release an annual sustainability report in 2006.[6][9] The company joined the United Nations Global Compact, the world's largest global corporate citizenship initiative, in 2007.[9]

References

  1. 1 2 https://www.aramex.com/content/uploads/100/55/48819/consolidated-financial-statements-31dec2014-en.pdf
  2. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 "Aramex: Delivering the Future" (PDF). William Davidson Institute. 06-05-2009. Retrieved 2014-08-24. Check date values in: |date= (help)
  3. 1 2 3 4 5 6 7 8 9 10 Fadi Ghandour (March 2011). "How I Did It: The CEO of Aramex on Turning a Failed Sale into a Huge Opportunity". Harvard Business Journal. Retrieved 2014-08-24.
  4. ↑ Rory Jones (01-08-2014). "IFC, Aramex Founder to Launch VC Fund for MENA Tech Startups". Retrieved 2014-08-24. Check date values in: |date= (help)
  5. 1 2 3 4 5 6 7 "Fadi Ghandour, Founder Of Aramex". NPR. 05-01-2014. Retrieved 2014-08-24. Check date values in: |date= (help)
  6. 1 2 3 4 5 6 7 8 Rola Tassabehji (2008-08-26). "CEO view: Fadi Ghandour of Aramex". Retrieved 2014-08-24.
  7. 1 2 3 4 Massoud A. Derhally (2012-05-20). "Aramex to spend $100m on acquisitions by 2013, says CEO". Retrieved 2014-08-24.
  8. ↑ Daniel Shane (02-04-2014). "Dubai’s Aramex to be $1bn company this year, says CEO". Retrieved 2014-08-18. Check date values in: |date= (help)
  9. 1 2 3 4 "Innovation key to carve niche: Aramex". Emirates 24/7. 2008-09-22.
  10. ↑ Friedman, Thomas. The World is Flat.
  11. ↑ "Abraaj Capital".
  12. ↑ "Global Distribution Alliance".
  13. ↑ "InfoFort".
  14. ↑ "Priority Airfreight".
  15. ↑ "Freight Professionals".
  16. 1 2 Friedman, Thomas (2005). The World is Flat. Farrar, Straus & Giroux. ISBN 1598954814.
  17. ↑ "cceia.org".
  18. ↑ "WikiSummaries".
  19. ↑ Ed Attwood (2011-02-15). "Aramex buys two Kenyan firms, eyes further deals in 2011". Retrieved 2014-08-24.
  20. ↑ Nina Curley (2011-12-12). "Aramex Acquires South African Logistics Firm Berco Express: Why It Matters to MENA Entrepreneurs". Retrieved 2014-08-24.
  21. 1 2 Naushad K. Cherrayil (2012-09-14). "PayPal launches Mideast operations with Aramex deal". Retrieved 2014-08-24.
  22. ↑ "Are You REDe to Break into E-Commerce?". 04-05-2012. Retrieved 2014-08-24. Check date values in: |date= (help)
  23. 1 2 Nancy Curley (2013-08-18). "ShopGo makes it easier for any e-commerce company to manage logistics with Aramex". Retrieved 2014-08-24.
  24. 1 2 "Courier Aramex targets Middle East medical services with Biocare". 2014-03-17. Retrieved 2014-08-24.
  25. ↑ Robert Anderson (2014-06-15). "Aramex Acquires Australia’s Mail Call Couriers". Retrieved 2014-08-24.
  26. ↑ Balakrishnan, Melodena Stephens; Michael, Ian; Birkelund, Gunn Elisabeth; Moonesar, Immanuel Azaad (2013). East Meets West. Emerald Group Publishing.
  27. ↑ Ibrahim, Barbara; Sherif, Dina H. From Charity to Social Change: Trends in Arab Philanthropy. American Univ in Cairo Press.
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