KUALA LUMPUR: Although GD Express Carrier Bhd’s (GDEX) earlier plans to expand to Laos did not materialise, the express delivery and logistics services provider is still eyeing regional expansion as competition heats up in the domestic courier segment.
GDEX CEO and executive director Leong Chee Tong said yesterday the group had been looking for opportunities in Southeast Asia, with Indonesia being a potential destination in the near term.
The ACE Market-listed company is in preliminary discussions with potential local partners in Indonesia and other neighbouring countries, Leong told The Edge Financial Daily after the GDEX AGM yesterday.
Leong said GDEX would likely team up with local partners in countries in Southeast Asia as direct entry appeared a less probable model.
“The form of collaboration would depend on the situation and conditions in the respective countries,” Leong said.
GDEX first revealed its regional aspirations in early 2009 when it entered into a memorandum of understanding with Laos’ national postal operator Entreprise Des Postes Lao.
Entreprise Des Postes Lao and GDEX had concluded feasibility studies and worked on proposals for a prospective strategic partnership but the initial talks did not bear fruit.
“For the past few years, we have been working hard on Laos but we did face some hindrance there. Maybe the timing was not right. There are some changes in the country,” Leong said.
Nevertheless, GDEX is still awaiting opportunities for its Laotian plans in the future, he said.
When asked, Leong said GDEX could also team up with its substantial shareholder, Singapore Post Ltd (SingPost), for the group’s regional expansion plans.
“I won’t rule out going regional with SingPost. But I think we will first look at what we can do together in Malaysia.
“Singapore is a saturated market, SingPost doesn’t need us there. It is more for expanding here or in the region,” Leong said.
SingPost emerged as a strategic investor of GDEX on March 15 after it increased its stake in GDEX to 27.08% from the initial 4.98%.
According to the website, GDEX operates a network of 96 stations which comprise 53 branches, two affiliate stations and 41 agents throughout East and West Malaysia.
It is currently assuming the role of SingPost’s local partner, delivering the Singapore postal operator’s express shipments to Malaysia.
But there are plans to deepen the working relationship into other areas of cooperation.
Leong pointed out that there are gaps in the services sector which GDEX could fill, such as in warehousing and logistics management.
Anticipating growing demand for integrated logistics services, GDEX last year boosted its warehousing facilities and developed its freight handling resources to complement its core business of express delivery service. The group has leased a 59,886-sq ft warehouse and invested in upgrading its infrastructure and handling capacities.
In GDEX’s 2010 annual report, the group noted that although these investments would initially affect the group’s bottom line, it is essential to propel GDEX to become a total logistics solution provider.
Leong is upbeat that GDEX and SingPost can leverage on the warm diplomatic ties and flourishing trade between Singapore and Malaysia.
He noted that some Singapore-based businesses had already moved their operations headquarters and production base to Malaysia.
“There are big opportunities in the Iskandar Malaysia region in Johor. It is good that we talk now (to SingPost). When the time is ripe, we are ready,” Leong added.
This article appeared in The Edge Financial Daily, December 8, 2011.
GDEX CEO and executive director Leong Chee Tong said yesterday the group had been looking for opportunities in Southeast Asia, with Indonesia being a potential destination in the near term.
The ACE Market-listed company is in preliminary discussions with potential local partners in Indonesia and other neighbouring countries, Leong told The Edge Financial Daily after the GDEX AGM yesterday.
Leong said GDEX would likely team up with local partners in countries in Southeast Asia as direct entry appeared a less probable model.
“The form of collaboration would depend on the situation and conditions in the respective countries,” Leong said.
GDEX first revealed its regional aspirations in early 2009 when it entered into a memorandum of understanding with Laos’ national postal operator Entreprise Des Postes Lao.
Entreprise Des Postes Lao and GDEX had concluded feasibility studies and worked on proposals for a prospective strategic partnership but the initial talks did not bear fruit.
Leong: There are big opportunities in the Iskandar Malaysia region.
“For the past few years, we have been working hard on Laos but we did face some hindrance there. Maybe the timing was not right. There are some changes in the country,” Leong said.
Nevertheless, GDEX is still awaiting opportunities for its Laotian plans in the future, he said.
When asked, Leong said GDEX could also team up with its substantial shareholder, Singapore Post Ltd (SingPost), for the group’s regional expansion plans.
“I won’t rule out going regional with SingPost. But I think we will first look at what we can do together in Malaysia.
“Singapore is a saturated market, SingPost doesn’t need us there. It is more for expanding here or in the region,” Leong said.
SingPost emerged as a strategic investor of GDEX on March 15 after it increased its stake in GDEX to 27.08% from the initial 4.98%.
According to the website, GDEX operates a network of 96 stations which comprise 53 branches, two affiliate stations and 41 agents throughout East and West Malaysia.
It is currently assuming the role of SingPost’s local partner, delivering the Singapore postal operator’s express shipments to Malaysia.
But there are plans to deepen the working relationship into other areas of cooperation.
Leong pointed out that there are gaps in the services sector which GDEX could fill, such as in warehousing and logistics management.
Anticipating growing demand for integrated logistics services, GDEX last year boosted its warehousing facilities and developed its freight handling resources to complement its core business of express delivery service. The group has leased a 59,886-sq ft warehouse and invested in upgrading its infrastructure and handling capacities.
In GDEX’s 2010 annual report, the group noted that although these investments would initially affect the group’s bottom line, it is essential to propel GDEX to become a total logistics solution provider.
Leong is upbeat that GDEX and SingPost can leverage on the warm diplomatic ties and flourishing trade between Singapore and Malaysia.
He noted that some Singapore-based businesses had already moved their operations headquarters and production base to Malaysia.
“There are big opportunities in the Iskandar Malaysia region in Johor. It is good that we talk now (to SingPost). When the time is ripe, we are ready,” Leong added.
This article appeared in The Edge Financial Daily, December 8, 2011.
