Karooooo, the owner of Cartrack, has acquired the South African-based on-demand logistics provider Picup Technologies for R70 million.
The company has acquired 70.1% of Picup Technologies.
Founded in South Africa in 2014 – after its founder had a disaster of an experience with a Black Friday delivery, which sparked the famous light-bulb moment: “Logistics needs better tech!”.
The vision was to develop technology that would improve efficiencies and reduce transportation costs for shippers and transporters through a single logistics platform connected to a marketplace of verified crowd-sourced drivers across Africa.
Uniquely positioned in the on-line delivery operational management software industry, Picup, a system integration partner of Cartrack, is a highly competitive and entrepreneurial founder-led business, with an impressive management team and strong growth prospects given the acceleration of e-commerce transactions and the demand to digitalize logistics.
Given that Cartrack’s mobility open eco system platform allows for seamless integration into third party systems, Picup a logistics cloud-based disruptive technology company located in South Africa, has been working with Cartrack to address the challenges of last-mile delivery through an integrated offering.
Picup simplifies transport operations and helps mitigate the risks associated with logistics, specifically in relation to meeting tight delivery timeframes.
Cartrack customers are now able to manage their own fleets and workflows, interact with specialist courier companies, as well as a network of vetted crowd-sourced drivers,
thus enabling them to efficiently scale their e-commerce business, deliveries and general logistic needs.
The platform allows enterprises and transporters to plan and allocate their loads, access real-time tracking and proof of delivery with automated payments.
The logistics industry has historically been very inefficient with many enterprises not optimizing their fleets and often having an inflated fleet size to balance customer demand. As e-commerce booms, retailers and wholesalers require more efficient, flexible and cost-effective ways to optimize delivery capacity using a cloud solution.
Picup facilitates an elastic fleet of third-party delivery drivers to handle overflow volumes,
allowing clients to plan optimally, without having to factor surge periods into their base operating capacity.
Picup, a start-up currently completing over 200,000 monthly deliveries, successfully services large blue-chip enterprises such as Dischem and Pick n Pay.
Picup’s annualized growth revenue run rate stood at R79 million at July 31, 2021, which represented a 130% increase over that of March. Picup’s scalable business model has gained in relevance post the emergence of Covid-19, offering a meaningful opportunity for
Karooooo has a robust balance sheet and has consistently demonstrated its ability to achieve scale and deliver high-quality organic earnings growth with strong free cash flow generation.
The company said this transaction supports the growth aspirations of Cartrack and Picup as the demand for last-mile delivery escalates at a rapid rate.
“As we think beyond connected vehicles, it is imperative that our cloud platform is a comprehensive mobility solution that addresses the needs of both our existing and future enterprise customers,” Zak Calisto, CEO and Founder of Karooooo and Cartrack, said.
“E-commerce transactions across the globe are increasing dramatically and we need to ensure that we are well-positioned to assist our enterprise customers in fully digitalising the mobility aspects of their businesses. Picup helps enterprises scale their operations without having to unnecessarily invest in additional assets.
“Our customers that use the Cartrack Delivery functionality on our platform will soon be able to have a one stop cloud platform to manage their fleets with the option of using crowd-sourced drivers when faced with unplanned demand.”
Commenting on the Picup team, Calisto said, “The management team is business savvy, customer centric and has the start-up mindset that we treasure.”
Antonio Bruni, founder and CEO of Picup, and the management team, will remain invested with a 29.9% interest in Picup.
Karooooo has the option to increase its shareholding to 83.5%.
Commenting on the acquisition, Bruni said, “Picup’s committed management team is excited about scaling Picup with Karooooo, who has a proven track record of scaling a business with prudent financial discipline.”
Director appointments and designation
At the first Board meeting following the AGM, the directors decided to appoint Calisto as Interim Chairman, with SK Lim as Lead Independent Director.
While the Board recognizes the general preference for an independent chairman, Lim, who is independent and has many years of experience in dealing with Board members, has the ability to reflect the Board’s positions in a forthright and constructive manner, especially when they are contrary to that of the executives.