The logistics sector in Pakistan has been navigating rapid growth while grappling with persistent challenges. The sector has long struggled with outdated infrastructure, inconsistent regulatory frameworks, and inefficiencies in transportation networks. However, it has recently undergone significant transformation, driven by technological advancements such as digital tracking and e-commerce integration.
Secure Logistics Group Limited (SLGL), the only logistics company listed on the Pakistan Stock Exchange, recently announced its merger with Trax Online. This merger combines their operations to create a unified entity that will capitalize on their complementary strengths.
At the outset, the merger is expected to integrate Trax’s technological expertise with SLGL’s capabilities in asset tracking, long-haul logistics, and security services. SLGL, a leading integrated logistics provider in Pakistan, offers services such as long-haul transportation, asset tracking, and security solutions, operating a fleet of over 160 trucks. Trax Online brings tech-enabled logistics across more than 650 cities and a substantial customer base, serving industries ranging from retail to banking.
The merger, structured as an amalgamation under the Companies Act 2017, is expected to be finalized by December 31, 2024, pending regulatory approvals. The goal is to create a robust 4PL (fourth-party logistics) provider that will offer seamless services to over 300 corporate clients while simultaneously catering to thousands of small and medium enterprises across various business segments.
As SLGL progresses toward completing the merger, the market will closely watch how this newly unified entity capitalizes on synergies, expands its service offerings, and enhances shareholder value. The merger aims to leverage economies of scale, reduce costs by eliminating overlaps, and unlock synergies to boost financial performance. SLGL has already demonstrated strong financial results. In the first half of CY24, the company reported a 12 percent revenue increase, reaching Rs1.2 billion. SLGL’s position on the Pakistan Stock Exchange has strengthened its financial standing, with its earlier IPO being oversubscribed. The company used IPO proceeds to deleverage its balance sheet, significantly reducing financing costs. This deleveraging, combined with the merger, positions SLGL as a more competitive player in the logistics market.
Additionally, SLGL has partnered with global shipping giant Maersk to provide onshore logistics services, expanding its international footprint. The company is also set to receive a Transports Internationaux Routiers (TIR) license, enabling it to operate in international markets, especially in Central Asia.
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