US freight major eyes $14bn Saudi petrochem market

Fawzi Ahmed Kanoo, chairman of Kanoo Freight, and Richard J. Bolte Jr., BDP president and CEO, announce the joint venture at a press conference in Manama on Tuesday. (AN photo)

By MAHMOOD RAFIQUE | ARAB NEWS

MANAMA: Bahrain-based Kanoo Freight, a division of Yusuf Bin Ahmed Kanoo LLC, and BDP International on Tuesday announced the formation of a joint venture company to serve the logistics and transportation needs of the Middle East.

The new entity, a 50-50 joint venture between the two groups called BDP Kanoo Chemical Logistics to be based in Dammam, will focus on $14 billion Saudi petrochemical market.

However, financial terms of the agreement between the two privately held companies were not disclosed. 

A top officials at BDP International during a press conference said the burgeoning chemical and petrochemical industry has necessitated the US giant to enter the Middle East market with offices located in Saudi Arabia. The new entity is keen to see a huge business in 2010 and will serve Middle East chemical sector.

Established over 100 years ago, Kanoo was one of the first shipping and logistics agencies in Saudi Arabia and has grown to become one of the largest privately held regional conglomerates in the Middle East. Kanoo has diversified across a number of complementary transportation enterprises, with an office and warehousing network covering the entire Arabian Peninsula and the Indian subcontinent.

BDP, which is headquartered in Philadelphia, Pa., USA, has earned a reputation for domain expertise in the chemical sector over the past 40 years, and today serves nine of the world's top 10 multinational chemical producers, as well as hundreds of others through a global network of wholly owned offices, joint ventures and affiliates in more than 120 countries. Kanoo is a charter member of the BDP Global Network.

"The establishment of this joint venture will provide the services needed for the region to fulfill its vision of economic diversification and adding more value downstream in the hydrocarbon industries," said Fawzi Ahmed Kanoo, board member of Yusuf Bin Ahmed Kanoo Group and chairman of Kanoo Freight.

"With the emergence of the Middle East as a global logistics hub, customers in the chemical and petrochemical sector place a great deal of importance on reliable on-time supply, and BDP Kanoo is designed to focus on delivering against or exceeding these expectations."

"With significant investments in the downstream petrochemical industries and abundance of feedstock, the Middle East, and Saudi Arabia in particular, is becoming the epicenter of the global petrochemical industry," said BDP President and CEO Richard J. Bolte Jr.

"We have a substantial base of clients operating in the region which stand to benefit from our strong presence in the global chemical and petrochemical sector complemented by Kanoo's deep expertise in regional and local trade and regulatory practices."

According to World Trade Organization (WTO) figures, Saudi Arabia's petrochemical exports topped $14 billion in 2008.

 

 

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