Royal Mail plc (LON:RMG) has acquired a California-based overnight delivery group for US$90mln (£71mln) as its General Logistics Systems (GLS) division expands into the US.
Golden State Overnight Delivery Service (GSO) operates in Arizona, Nevada and New Mexico with 36 facilities across the region. It was acquired on a cash and debt-free basis.
GSO makes around 13.5mln deliveries a year and with a market share of just 1%, but was acquired for its geographic positioning and expansion potential, said the Royal Mail.
"It is well-positioned to benefit from growth in intra-State deliveries within its existing geographic footprint,” said the group.
The states in which GSO operates have a combined gross domestic product roughly equivalent to the UK, but faster growth than both the UK and the rest of Europe.
"The acquisition of GSO is in line with our strategy of careful and focused geographic expansion. GSO operates in an attractive regional market representing the world's fifth largest economy, and provides GLS with an opportunity to grow GSO within its existing footprint,” said GLS chief executive Rico Back.
The deal follows the €71m (£63mln) acquisition of ASM Transporte Urgente in June.
Last week city broker Liberum downgraded Royal Mail to “sell” after Deutsche Post (ETR:DPW) announced the takeover of UK Mail (LON:UKM), pitting the two against each other for UK parcel delivery.
Shares in Royal Mail were around 2% higher at 500p.