London, Ontario—a seemingly quiet Canadian city—holds strategic importance in North America's logistics landscape. The recent move by a U.S. logistics giant to establish operations here could reshape regional and continental supply chain dynamics. Kenco, a leading third-party logistics (3PL) provider headquartered in Chattanooga, Tennessee, is answering this question through a strategic acquisition.
Acquisition Overview
In early 2024, Kenco announced the acquisition of Drexel Industries' 3PL operations in London, Ontario. While financial terms remain undisclosed, the deal includes four strategically located warehouses in the London area. These facilities form an equidistant triangle between Toronto, Detroit, and Buffalo, creating a multi-client distribution campus that enables resource sharing and operational flexibility. Approximately 100 Drexel employees joined Kenco as part of the transaction.
About Drexel Industries
Founded in 2012, Drexel specialized in global distribution services for B2B and B2C brands, offering comprehensive solutions including warehousing, order fulfillment, Amazon FBA prep, brokerage services, and reverse logistics. The company's extensive experience in Ontario's market provides Kenco with critical local expertise for Canadian expansion.
Strategic Rationale
Kenco President and CEO Denis Reilly emphasized that the acquisition enhances service capabilities for existing Canadian clients through expanded warehouse access and logistics services. The 820,000-square-foot facility portfolio represents a key component of Kenco's North American growth strategy.
Key Benefits
- Canadian Market Expansion: Accelerates Kenco's growth in Canada with immediate operational scale
- Service Enhancement: Complements Kenco's offerings with Drexel's expertise in fulfillment and reverse logistics
- Geographic Advantage: Optimizes distribution networks between major North American markets
- Talent Integration: Brings 100 experienced logistics professionals into Kenco's workforce
- Synergistic Opportunities: Incorporates Drexel's co-packing and co-filling capabilities into Kenco's service portfolio
Client Advantages
The merger combines Kenco's automation technologies with Drexel's regional knowledge, creating enhanced 3PL solutions. Clients gain access to expanded warehousing options, comprehensive logistics services, improved delivery efficiency, and advanced technical support throughout North America.
Competitive Positioning
This transaction creates mutual benefits—boosting Kenco's Canadian presence while providing Drexel's clients with leading 3PL solutions. The combined entity leverages technological leadership, deep market knowledge, and operational synergies to deliver value-added services.
London's Strategic Value
As Ontario's 11th-largest city, London occupies a prime logistics corridor between Toronto and Detroit. Drexel's original facility selection recognized this geographic advantage, and Kenco's acquisition strengthens its North American distribution network.
Industry Implications
This acquisition reflects accelerating consolidation in North America's logistics sector, driven by e-commerce growth and rising consumer expectations. Kenco's move establishes critical infrastructure for future expansion while demonstrating how strategic acquisitions can enhance service capabilities and competitive positioning.
Additional Transaction Details
The deal specifically includes Drexel's 3PL business operations, four London-area warehouses, and personnel. Kenco plans to integrate Drexel's co-packing and co-filling services—valuable capabilities for food and beverage companies requiring rapid product deployment.