PUBLICLY-LISTED Aboitiz Transport System Corp. (ATSC), the transport business of the Aboitiz Group of Companies, will merge two of its wholly owned subsidiaries to further provide integrated service offerings to its clients, with ATS as the surviving corporation.
In a recent disclosure to the Philippine Stock Exchange (PSE), ATSC announced the Securities and Exchange Commission’s (SEC) approval of the company’s statutory merger with Zoom in Packages Inc. (ZIP).
“The merger of ATSC and ZIP will enable ATSC to provide integrated service offerings to its clients ranging from full container to loose cargo loads, and will improve effectiveness and efficiency of the delivery of freight services of ATSC, as well as achieve more effective management and cost efficiencies for both companies,” the company said.
“We are continuously finding ways to improve our service. We have been integrating our 2GO services in order to provide seamless solutions to clients,” said ATSC corporate planning and investor relations officer Vivien Vicente, noting that they started thinking about the possibility of merging late last year as they started integrating the 2GO business.
She told Sun.Star Cebu that merging companies will result in cost efficiencies and better synergies and customer service as ZIP’s business focus is also on full container load (FCL) and loose container load (LCL) cargo, similar to ATSC.
ZIP is engaged in moving loose cargo and provides integrated logistics solutions, such as door-to-door pick-up and delivery of goods, warehousing and storage, distribution, supply chain management, and loading and re-loading of cargo on any air, land or sea carrier.
The total cost of the merger is approximately P18 million. The paid-up capital stock for ZIP is P60 million.
“The cost is mostly on retrenchment benefits. We do anticipate cost savings from the expected synergies created,” she said.
Vicente reported that about 90 employees will be affected as a result of the merger. She, however, said, they can apply with ATSC.
ATSC also said the merger would have no impact on ATSC’s equity structure or the value of its shares, with its officers and directors keeping their present positions.
Another merger
Aside from merging with ZIP, Vicente also reported the recent stockholders’ approval of another statutory merger with its wholly owned subsidiary, Reefer Van Specialist Inc. (RVSI).
Similar to ZIP, Vicente said the RVSI merger will also result in cost efficiencies and better synergies with its 2GO business.
RVSI is in the business of offering refrigerated transportation services under the CRYO brand name for perishable food products, such as processed meat, poultry, fruits, vegetables and non-food products, like electronics, flowers and chemicals.
The merger, however, is still subject to regulatory approvals of relevant government agencies such as the SEC, the company said.
During the first quarter of 2010, ATSC recorded a P141.9-million net loss due to the maintenance of most of its vessels and higher fuel prices.
ATSC operated at a very limited capacity during the first quarter as three of its Superferry vessels were under maintenance and dry-docking.
ATSC reported that the company operated only 64 percent of its total passenger fleet capacity and 82 percent of freight capacity. Its consolidated revenues reached P3.1 billion, a 10 percent improvement over the P2.9 billion registered in the same period last year.
With the completion of maintenance and dry-docking of its vessels and with the addition of two new vessels in the second half of the year, the firm said it will be able to increase its passenger and freight capacity.