Malaysia-listed bunkering firm Straits Inter Logistics (Straits) is considering a horizontal expansion into the land transportation and logistics business through a wholly-owned subsidiary company, namely Straits Alliance Transport Sdn Bhd, it says.
“Certain customers that Straits Group are currently rendering its oil trading and oil bunkering services to, have been requesting for land transportation and logistics services from Straits,” it says.
“After due deliberation and in view of the demand from the existing customers, the board has decided to embark on this new transportation line which is in land transportation and logistics business.”
According to the board, the latest development aligns well with its strategy to identify new business opportunities within the logistics segment, which is expected to provide additional revenue and income stream to the group.
“The new venture into the land transportation and logistics business would enable Straits Group to encompass both onshore (land transportation) and offshore (marine/ sea transportation) transportation and logistics services, which positions the Group in an extended horizontal chain with differing services offering within the transportation and logistics sector,” it notes.
“Through the proposed diversification, the group is expected to widen its existing customer profiles to include customers from both land transportation and logistics industry as well as from marine transportation and logistics industry moving forward.
“As oil bunkering and land transportation businesses are types of transportation and logistics services, the board believes that Straits Group has the existing capacities, capabilities, and resources to venture into the land transportation and logistics business, as the nature and business processes of oil bunkering and land transportation businesses are essentially similar, whereby both are involved in the provision of transportation and logistics services.”
The finalised decision confirming the proposed land transportation and logistics services plan is expected to be completed by the first quarter of 2019.
Photo credit: Straits Inter Logistics
Published: 7 December, 2018
