As North American businesses seek more efficient and flexible supply chain solutions in global markets, the strategic positioning of logistics providers becomes increasingly critical. In a significant move that will reshape the North American logistics landscape, Kenco, a leading US-based third-party logistics (3PL) provider, has announced the acquisition of Canadian firm Drexel Industries' 3PL operations.
The Acquisition Details
Headquartered in Chattanooga, Tennessee, Kenco finalized the acquisition earlier this month. Drexel Industries, based in London, Ontario, specializes in logistics and distribution services for both B2B and B2C enterprises. While the financial terms remain undisclosed, the transaction includes Drexel's entire 3PL business and four strategically located facilities in the London area.
These facilities form a multi-client distribution campus with equal proximity to Toronto, Detroit, and Buffalo, enabling resource sharing and flexible operations. The acquisition also brings 100 Drexel employees into Kenco's workforce and expands Kenco's service offerings through Drexel's expertise in co-packaging and co-filling operations.
Leadership Perspectives
Denis Reilly, Kenco's President and CEO, emphasized the strategic rationale: "As Kenco continues to grow, we're constantly seeking opportunities to better serve our existing Canadian customers. With Drexel Industries joining the Kenco family, clients of both brands will gain access to an expanded warehouse and logistics network."
Founded in 2012, Drexel Industries has built its reputation serving B2B and B2C brands with comprehensive solutions including warehousing, fulfillment, Amazon FBA prep, brokerage services, and reverse logistics.
Key Insights from Kenco's Q&A
What motivated Kenco to acquire Drexel's 3PL business?
"While Kenco already operates in Canada, Drexel's four London-area warehouses—adding 820,000 square feet of space—presented an ideal opportunity to expand our Canadian presence. Acquisitions remain central to Kenco's growth strategy."
How will customers benefit from this transaction?
"This merger combines Kenco's advanced automation and technology with Drexel's deep Canadian market knowledge, enhancing 3PL solutions for all clients. The addition of four strategic Ontario warehouses and 100 employees extends Kenco's service reach across North America."
What competitive advantages does this deal create?
"The synergy between Kenco's technological resources and Drexel's market expertise will elevate Kenco's Canadian profile while providing Drexel clients access to leading 3PL solutions."
Strategic Implications of the Acquisition
1. Strengthening Canadian Market Position
The acquisition accelerates Kenco's penetration into the Canadian market, leveraging Drexel's established client base and local reputation to build stronger brand recognition.
2. Expanding Service Capabilities
Drexel's expertise in specialized areas like Amazon FBA prep and reverse logistics complements Kenco's service portfolio, enabling more comprehensive solutions for diverse client needs.
3. Optimizing Distribution Networks
The strategically located London facilities create operational efficiencies through their equidistant positioning to major North American markets, reducing transportation costs and improving delivery times.
4. Enhancing Technological Edge
The integration of Kenco's automation systems with Drexel's operational knowledge will drive innovation in logistics solutions.
5. Talent Integration
Drexel's experienced workforce brings valuable Canadian market knowledge to strengthen Kenco's operational capabilities.
Client Benefits
For Kenco's existing clients, the acquisition means access to expanded warehouse networks, broader service options, and advanced technological solutions. Drexel's clients will gain the stability of Kenco's financial resources while maintaining access to their familiar service teams.
Future Outlook
This acquisition marks a strategic milestone in Kenco's North American expansion, demonstrating its commitment to delivering comprehensive logistics solutions through both organic growth and targeted acquisitions.