(Yicai Global) Jan. 25 -- Yunda Holding, one of China’s big five delivery firms, will pay USD94.8 million for a 6.5 percent stake in fellow courier company Deppon Logistics, Deppon said today.

The deal will make Yunda, which holds a more than 15 percent share of China’s express delivery market, the second-largest shareholder in Shanghai-based Deppon. The investment was first broached in May last year through Yunda subsidiary Fushan Investment. The private placement has yet to be approved by authorities.

Shanghai-based Yunda’s stock price [SHE:002120] closed up 3.35 percent at CNY17.61 (USD2.72). Deppon finished 2.5 percent higher at CNY15.60.

The money raised will be used to upgrade smart devices in Deppon’s transshipment centers and improve its information technology system, the firm said.

The two parties have competitive advantages in different fields such as small parcels, large cargo and less-than-carload freight, Deppon said. By working together, they can cut costs and hike efficiency by better allocating resources and centralized procurement, boosting profitability.

Deppon, which is best known for its heavy parcel delivery service, provides full logistics services from delivery to warehousing to cross-border trade. Formed in 1996, it operates many international routes, including to South Korea, Japan and Thailand, and employs over 130,000 people worldwide.

Editor: Kim Taylor