Univar to Handle Shells Nordic Lubes


Univar has signed a long-term distribution agreement with Shell Group affiliates in Denmark, Finland, Norway and Sweden to market, sell and distribute Shell branded lubricants in those four countries. About 110 Shell employees are expected to transfer to Univar as part of the business transfer announced Monday.

The arrangement is in the approval process with regulatory authorities, and is expected to become effective in 2010s second quarter. Financial terms of the agreement were not disclosed.

According to Shell, the agreement covers the domestic lubricants sales, marketing and distribution activities of AB Svenska Shell, Oy Shell AB, A/S Norske Shell and A/S Dansk Shell, including local aviation and marine lubricants businesses.

This new distributorship is consistent with our continued efforts to increase global competitiveness and strengthen our ability to respond to market changes in the lubricants business, Shell Lubricants spokeswoman Courtneye Barrett told Lube Report. Part of this response is in simplifying our route-to-market operations. From previous experience in other countries (Switzerland, Austria, The Baltic countries), customers have benefited from working with more locally focused businesses that are already active in key channels and have extensive business contacts in the local markets. The model is a proven success in sustaining and growing Shell branded lubricant sales in countries where it has been implemented.

Univar said it will begin stocking Shell branded products in its local warehouses and also invest in establishing a new central hub in Gothenburg, Sweden. Shell Lubricants personnel will transfer to Univar when the deal completes, Univar stated, subject to staff consultation. Their competences, expertise and know-how will be invaluable in strengthening our market leadership in the Nordics, Univar EMEA President John van Osch said.

Ola Tengroth, Univar Europes regional director Nordics, said the two companies have worked successfully together over a number of years, and that the new agreement should help boost business for both companies.

Shell is one of our major suppliers in chemicals, and we have developed a good business in Nordics and overall in the Univar Group, Tengroth told Lube Report. We have also supplied into the Shell lubricants production, for example, in the Nordics. So far we have not sold or marketed the actual lubricants. This is really a fantastic opportunity to expand and develop this relationship.

Univar is growing aggressively in several parts of the EMEA region at the moment, Tengroth said. In the Nordic market, we have a strong customer base in many of our key segments, and the Nordic market is important for Univar. Univar Nordic has had a very strong performance so far in 2009 despite the economic climate, and we have a plan to more than double our profitability over the next few years, she continued. The transfer of the Shell business will accelerate this process and take us a number of years ahead of our plan.

Tengroth confirmed that Univar will distribute the same portfolio which Shell has distributed in the Nordics so far, including automotive, industrial, and commercial transport lubricants.

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