Aramex, the Middle East's biggest courier company, received regulatory approval to raise its foreign ownership limit (FOL) to 100 per cent from 49 per cent, it said on Thursday.
The company has received all the “necessary approvals from the Securities and Commodities Authority and all other relevant regulatory authorities”, Aramex said in a statement to the Dubai Financial Market, where its shares are traded.
“Accordingly, we would like to notify the shareholders that the increase of the FOL of Aramex stocks to 100 per cent will take effect as of May 30 before trading begins,” the company said.
Late last month, Aramex said that its board of directors had passed a resolution to remove restrictions related to foreign investment and increase the company’s foreign ownership limit to 100 per cent.
The decision is in line with Aramex’s global growth ambitions and lifting foreign ownership limits on its stock will "provide investors the opportunity to invest in the company as it embarks on the next stage of growth and expansion", it said at the time.
The move makes it the "first onshore UAE company listed on the DFM to allow for full ownership of its free-floating shares by foreign investors", Aramex said.
Aramex benefitted strongly from the increased demand for logistics and freight-forwarding services during the Covid-19 pandemic.
However, in line with the industry, it has also been hit with rising costs due to supply chain bottlenecks, as well as slowing demand for e-commerce as cross-border travel has picked up in recent months.
Earlier this month, the company reported a 3 per cent annual rise in net profit on higher revenue and improving global operations. Net profit for the three-month period through to the end of March rose to Dh47 million ($12.8m).
The Covid-19 years of 2020 and 2021 were “a black swan event” for the business, Alaa Saoudi, chief operating officer of Aramex Express said at the time.
“We witnessed unexpected surges in volumes because of the global lockdown.
“However, over the past three months, as most countries reopen and the majority of consumers return to normal shopping habits, we inevitably saw a softening in volumes in cross-border express," he said.
In January, Alpha Oryx, a company related to investment holding conglomerate ADQ, transferred a 22.32 per cent stake in Aramex to Abu Dhabi Ports.
France's parcel delivery company GeoPost, a business owned by Le Groupe La Poste, also bought a 20.15 per cent stake in Aramex last October for Dh1.4 billion, according to a filing on the DFM at the time.
Last year, Aramex also completed the sale of its data, technology and analytics firm InfoFort to US-based information management specialist Iron Mountain for $91m.
