Pall-Ex Group has confirmed the long-standing industry rumour that it has acquired the Fortec Distribution Network, formerly part of Geodis.
Geodis had confirmed to Logistics Manager back in June that it would discontinue distribution and express activities that are carried out by partner companies as part of a focus on fully-owned contract logistics and freight forwarding services in the UK – a move that had left the future of Fortec uncertain. Both parties had refused to comment to Logistics Manager on the much-mooted acquisition.
The pallet network has been purchased by a subsidiary company of Pall-Ex, For-Ex Distribution Network, and will remain trading as Fortec Distribution. Pall-Ex said it will continue to operate as a separate pallet network within the UK but be part of the overall Pall-Ex Group of companies.
The two networks, which were both founded in Leicestershire in 1996, have a combined total of 168 members. Pall-Ex Group now has over 600 members across Europe.
The deal includes Fortec’s 210,000 sq ft warehouse at Watling Park, Northamptonshire, which will give the entire Pall-Ex Group more than 600,000 sq ft of hub capacity.
Pall-Ex Group was bought out by its UK senior management team and shareholder members in November 2019. In February Pall-Ex (UK) subsidiary Cranleigh Distribution Services acquired the goodwill of the UK pallet operation from Cranleigh Freight Services.
The Fortec members will now be able to follow the Pall-ex ownership model and become shareholder members.
Group chief executive of Pall-Ex Group Kevin Buchanan said: “This is a significant step in Pall-Ex’s growth plans and a strategic move that will further strengthen our position in the UK.
“The addition to the group presents many benefits to our collective membership; Pall-Ex members are experiencing an increase in freight volume and need access to additional hub capacity, while Fortec members will have a say in the operation of their network under our unique shareholder model.
“While both firms will retain their brand identities, there are clear synergies that make this a natural partnership and we look forward to working together, winning together and becoming stronger together in this new era.”
Fortec MD Adrian Bradley said: “The acquisition places Fortec in a strong position and with Pall-Ex Group’s support and innovative new technology we can expand and enhance our network for the benefit of our members and our entire customer-base.
“We look forward to this new era, being part of the Pall-Ex family and providing members with the opportunity to invest in the network as shareholders.”
In consolidating two of the UK’s pallet networks there are now seven covering the country. UK Mail (now DHL) closed its pallet network division, UK Pallets, back in 2015.