Courier company Mailpac Group Limited is close to executing its first inorganic growth move.

The company, which was formed in 2019 as a vehicle to acquire related companies Mailpac Services Limited and Mailpac Local, began acquisition talks from 2020 when it announced plans to acquire an e-commerce platform that would catapult its growth within the Caribbean region.

But the plans were later placed on hold due to the economic downturn during the pandemic. Today, it’s back on the cards and Executive Chairman Khary Robinson expects the deal to be completed by June 2024.

“Given a few late-stage discussions currently underway, I expect Mailpac to announce and consummate a transaction that will meaningfully enhance its customer profile in the next three to six months,” Robinson told the Jamaica Observer. However, he did not say if the company being targeted for acquisition is still an e-commerce business.

The new acquisition comes amid an announcement by the Government to increase the duty-free threshold by 100 per cent for imported goods at the ports and personal items taken in at the airport during travel. The increase takes effect in April 2024.

Ultimately, the duty-free threshold for imported goods will move from US$50 to US$100 and personal items from US$500 to US$1,000, a move that is expected to allow the free flow of more small value goods into the country.

Mailpac had already seen significant organic growth ahead of the acquisition discussions. In the heights of the pandemic, when Mailpac was seeing extraordinary growth from a grounded travel market and social distancing measures, the company started to spend more cash on enhancing its processing capacity, customer service experience, additional delivery store locations and brand marketing to meet the spike in the demand.

Then last year, Mailpac invested $40 million in new lockers and the buildout of five new stores across the island to increase client’s accessibility to its service while deepening its reach in the growing courier service industry.

The company also struck a deal with retailer PriceSmart and later with Virtual Mart to source and deliver groceries and household items from its Mailpac Local website.

“All of the projects have been going well as our distribution reach and capacity is enhanced. We have also launched two new platforms that cater to new market needs and so we are excited about our overall growth prospects,” Robinson said in providing an update on the recent business ventures.

He added that the company is focused on better serving the cost-conscious customer and will soon announce “a few solutions that will revolutionise the service” Mailpac provides to that segment of the market.

Mailpac’s fourth quarter results are not yet published, but readings from Robinson based on an annual record in packages received over the Black Friday/Cyber Monday sale weekend are that revenues could be on the rise.

Throughout the third quarter of 2023, Mailpac said it maintained its strong focus on improving customer relations and optimising the shopping and delivery experience. Still, earnings dipped 11.7 per cent year over year to $68.6 million on revenues which also fell off by 3.2 per cent to $400.3 million.

“This variance was primarily driven by a decline in revenue from Mailpac Local,” the company said in the preamble to the financial statements.