(Toronto) Cargojet on Tuesday announced it has signed a new agreement with DHL Network Operations to provide air transportation services to DHL’s global network, which it says will increase revenue and help diversify its services.
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The agreement, which expands the relationship between the two companies, is for five years with an option to renew for two additional years. Financial details were not disclosed.
Under the agreement, Cargojet will provide services to meet DHL’s international requirements for Europe and North, South, Central and Latin America, as well as Asia.
Cargojet currently uses 12 cargo aircraft to meet DHL’s needs.
DHL intends to add five additional B-767 cargo aircraft during the 2022-23 period. It also intends to be Cargojet’s first customer for the B-777 long-range freighter, which is expected to start flying in late 2023 or early 2024.
In addition, Cargojet will issue warrants to DHL to acquire up to 9.5% of its outstanding voting shares at a price of $158.92 per share over a period of seven years. Their acquisition is subject to the delivery by DHL of up to 2.3 billion in business volume during the same period.