By Gabriel Araujo
SAO PAULO, Sept 10 (Reuters) - Brazilian cargo company Modern Logistics expects to enter the U.S. and Mexican markets in the few months as it puts in place an expansion strategy that will include looking at merger and acquisition opportunities in the short to mid-term.
WHY IT'S IMPORTANT
Modern is a big player in the fast-growing cargo market in Latin America's largest economy, which has been boosted in recent years by e-commerce and infrastructure investments.
RESTRUCTURING
Established in the 2010s by former Azul AZUL.N executives, Modern underwent a restructuring last year that saw former FedEx FDX.N executive Cristiano Koga appointed as CEO.
The firm is backed by asset manager DXA and private-equity firm H.I.G. Capital. It has invested some 300 million reais ($53.58 million) over the past year to get aircraft and enhance distribution centers, Koga told Reuters.
EXPANSION
Modern, whose main hub is the Viracopos airport Sao Paulo, started flying to Chile, Ecuador, Colombia, Argentina and Uruguay in August and aims to enter Mexico and the U.S. in 2025.
The ongoing expansion, whose first phase was organic, includes possible mergers or acquisitions both in Brazil and abroad in the 18 to 24 months, Koga said.
An initial public offering (IPO) or strategic merger could be ultimate goals, but would depend on market conditions.
ADDITIONAL CONTEXT
The size of Brazil's freight and logistics market is estimated at $105.5 billion and expected to reach $140.7 billion by 2030, according to research firm Mordor Intelligence.
Other major logistic operators there include the cargo divisions of traditional airlines Azul, LATAM LTM.SN and Gol GOLL4.SA, as well as Total, Jadlog and Braspress.
Modern currently operates four Boeing BA.N 737 aircraft, including two -generation 737-800 added over the past year, and has options to add more, Koga said.
($1 = 5.5988 reais)
(Reporting by Gabriel Araujo; Editing by Alexander Smith)
((Gabriel.Araujo2@thomsonreuters.com; +55 11 5047-3352;))