UPS adds gig delivery with Roadie acquisition

[LOS ANGELES] United Parcel Service (UPS) on Friday announced plans to buy Roadie, a crowd-sourced, same-day delivery company whose major clients include home improvement chain Home Depot.

The tie-up comes after key UPS retail customers like Amazon.com, Walmart Inc and Target Corp built or bought gig delivery services to provide speedy local delivery of everything from fresh food to bulky furniture.

UPS and Roadie did not disclose financial terms of the deal, which is scheduled to close in the fourth quarter.

It would add new UPS services just in time for the peak holiday shipping season when demand for local home delivery will surge.

"Roadie often provides service for shipments not compatible with the UPS network because of their size and perishable nature, and often because they are in shopping bags without the packaging required to move through the UPS system," UPS said in a statement.

Following the completion of the acquisition, Roadie will continue to operate with its existing name.

Goods transported by Roadie will not cross into the UPS network and packages transported by UPS will not cross into the Roadie network, UPS said.

UPS is the single largest employer in the Teamsters Union, and the company's delivery drivers are some of the industry's best compensated.

"(Roadie's) goods should not cross over to UPS and vice versa. We will watch closely to ensure that Teamster bargaining unit work is protected," Teamsters spokesperson Kara Deniz said.

Shares in UPS were up 1.4 per cent to US$191.67 in midday trading.

Shares in rival FedEx Corp were down 0.6 per cent to US$258.64.

REUTERS