(MENAFN- Khaleej Times)Tristar Group is planning to make some strategic acquisitions this year to spur its growth in line with its five-year business plan its top official says.
The UAE-based fully integrated liquid logistics solutions provider is keen to strengthen its shipping business and may explore opportunities in the offshore sector. "We are bullish on growing our ship-owning business and believe our short-term focus will be in this area" Eugene Mayne group chief executive officer of Tristar Group told Khaleej Times on the sideline of the company's new chemical storage facility in Jebel Ali Freezone recently. The Dubai-headquartered firm established its base in 1998 and has grown from a relatively small local transform company to a multi-faceted liquid logistics service provider with an operating presence in the Middle East Africa Asia the Pacific and Central America. It employs more than 1800 people of diverse nationalities and operates a fleet of more than 1000 road tankers pick-ups and flatbed trailers in Gulf Cooperation Council Africa and Asia regions. The company also owns and operates double hulled tankers and barges to transport clean petroleum products. Focus on shipping business Mayne pins hopes on shipping business for sustainable growth in near future and said new vessels due to join the company's fleet next year will help achieve growth targets in near future. "In late 2013 we reached an agreement and placed a firm order for six new MR product/chemical tankers with Korean shipbuilder Hyundai Milo Dockyard. All these vessels are expected to be delivered in 2016 and will be built to the latest specifications with an improved hull form design making them more fuel efficient and eco-friendly carrier" he said adding that the vessel deliveries will double the company's shipping fleet to 12. He said new vessels will be placed on long-term time charter with an oil major. "This deal indicates our willingness and appetite to invest in the shipping business on selected and strategic opportunities. There could also be opportunities for Tristar to expand its shipping business in the offshore sector" he said. Looking for opportunities Mayne said Tristar is looking for opportunities in the West Africa Sea the Northern Sea and the Indian Ocean mainly in the offshore supply vessels operations and in increasing its current coastal operations. "We work on a five-year business strategy cycle which is updated annually. Our strategy is clear - we need to average a compounded annual growth rate of at least 20 per cent. "We have traditionally relied on organic growth. The group is looking at making some strategic acquisitions this year which can spur the growth and help achieve goals set in five-year plan" he said. On the road transport side he said Tristar Group is planning to double its fleet to over 2000 vehicles in next three to five years and expand its presence in Saudi Arabia. "Our joint venture entity United Stars has been awarded a 10-year haulier contract by Saudi Aramco. We want to be a leading road fleet operator in the kingdom by 2020. We also intend to play a key role in promoting road safety and generally raising the standard of road transport within the kingdom." Rail network Mayne said fast developing rail network across the GCC will benefit logistics industry in the region by cutting transportation cost and improve efficiency. "We are also seeing positive developments on the infrastructure side such as the integrated GCC Railway which will provide the required infrastructure to absorb a large volume of freight having a drastic impact in the modal split of the region shifting volume from roads to rails." To a question about the company's first-of-its upcoming chemical storage facility in Jebel Ali Freezone (Jafza) he said it is strategically located with direct access to Jebel Ali Port and Al Maktoum International Airport and will also be connect to Etihad Railways in future. "The upcoming 350000 square feet chemical warehouse and bagging plant worth will be the first-of-its-kind silo and bagging facility in the Jafza. Once fully operational in mid-2016 the facility will offer better time to market delivery because of its strategic location connected with air sea and road and rail network." To a question about falling crude prices and its impact on Tristar business he said trading in petroleum products is not a mainstream activity for the group therefore volatility in oil prices has limited impact on its business operations. "Of course lower crude price is good for end-users and in emerging markets but in our region higher oil prices means more liquidity in the market which in turn generates more spending on infrastructure development that opens up opportunities for the logistics Industry." On the positive side he said low oil prices stimulate more consumption and stock piling which in turn generates need for more logistics infrastructure. "It is important to have a long-term balanced view on business and this is where our depth of experience and strength in liquid logistics operations come into play as we manage the risks and the rewards of volatility in oil prices in a diverse and global transport operation" Mayne concluded. -
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