C.H. Robinson enters India market with Triune acquisition

Jeff Berman, Senior Editor -- Logistics Management, 12/1/2006

MINNEAPOLIS—Non-asset based third partly logistics (3PL) services provider C.H. Robinson Worldwide Inc. said today it has acquired certain assets of Triune Freight Private Ltd and Triune Logistics Private Ltd, a 3PL services provider in Chennai, India.

Financial terms of the acquisition were not disclosed.

Triune serves more than 600 customers and provides air and ocean international forwarding and customs clearance services, with annual gross revenues of $11 million. Founded in 1999, the company also has a projects division dedicated to highly specialized movements.

Expanding the international freight network
Chad Lindbloom, C.H. Robinson vice president and chief financial officer, told Logistics Management that one of the company’s key growth initiatives is to expand its international freight forwarding network. And he added that this was the main driver behind this acquisition. This acquisition is C.H. Robinson’s first foray into India, and it brings the company’s number of international offices to 19.

“Today we can move [freight] from most anyplace to anywhere, but a lot of times we use agents in places that we don’t have our own offices,” said Lindbloom. “One of our long-term strategies has been to try to open offices in areas where we see a significant amount of business opportunity. India is obviously one of those places, with a fast-growing economy and there is a lot of export activity out of India and a growing amount of imports into India.”

Lindbloom added that Triune has good mix of customers that both import and export out of India. By taking Triune’s business and joining it with C.H. Robinson’s international branch network, he said C.H. Robinson can provide value to Triune’s existing customers. And he noted that C.H. Robinson has a significant amount of freight coming out of India today via India-based transportation agents, which will continue to help that business grow.  

As for its customers that import and export freight out of India, Lindbloom said they should expect the same high level of service that they currently receive with C.H. Robinson’s transportation agents.

“We are very selective about what [transportation] agents we use, and we have very tight parameters our agents must operate under,” said Lindbloom. “We think this acquisition will bring things to the next level of customer service by having our own controlled service there.”

A C.H. Robinson trend
Evan Armstrong, president of the consulting firm Armstrong and Associates Inc. said that with this acquisition, Robinson gains a foothold in a rapidly-developing country.

“C.H. Robinson is well-known for acquiring small logistics operations that they have had some experience with and using those to provide a beachhead into new markets,” said Armstrong.

This acquisition is similar to one C.H. Robinson made in 2004, Armstrong said, when it acquired China-based Dalian Decheng Shipping Agency Company. At the time of the acquisition Dalian had seven offices in mainland China, which allowed C.H. Robinson to gain a foothold into the Chinese market. And in 2003, it acquired Frank M. Viet GmbH. Internationale Spedition, a Hamburg, Germany-based forwarder, which had 15 offices in Europe at the time of the acquisition.

“These acquisitions are somewhat similar in that they are all going after small, well-run company’s that fit into the C.H. Robinson model,” said Armstrong.

As for perceived shipper benefits of the Triune acquisition, Armstrong explained that in developing countries like China and India that have different legal requirements than in the United States, it is important to have some local expertise when trying to manage transportation processes. And by making these acquisitions, he said that Armstrong is gaining a local customer base and local knowledge of how to operate within these countries.