US-BASED transport and logistics provider YRC Worldwide said yesterday it was acquiring Shanghai Jiayu, a ground transport firm, by the end of the year as it sees the Chinese firm's network as "critical."

The two firms have reached a preliminary deal that will go through after approval by the companies' boards and the Chinese regulatory authorities. The price of the deal was not disclosed.

"This acquisition will allow us to build a service network that will provide greater reliability for our customers as they move shipments within China as well as provide seamless, end-to-end service for international movement in the critical US-China trade lane," said Bill Zollars, chairman of Nasdaq-listed YRC.

Zollars added that 90 percent of his firm's 800,000 customers needed transport services in China and that Jiayu's network was "critical" to YRC's success in the country.

Jiayu is a privately-owned firm with 30,000 customers and 3,000 vehicles. Zollars said the deal will "significantly" expand the local "scale and capabilities" of YRC, which now has fewer than 200 vehicles in China.

Officials hinted that following the deal, the names Jiayu and YRC Logistics, a wholly-owned subsidiary of YRC, might be merged to form a new brand name.

The deal is the latest in a line of takeovers of local logistics firms by foreign giants. Last year, Dutch firm TNT purchased Heilongjiang-based Huayu Logistics for 800 million yuan, while FedEx spent three billion yuan buying out its Chinese joint venture partner Tianjin Datian.