YRC Worldwide says acquisition to fuel China growth

SHANGHAI, June 27 (Reuters) - U.S. trucking company YRC Worldwide Inc.'s (YRCW.O) logistics arm expects its annual sales growth in China to speed up to as much as 35 percent next year from 22 percent last year, after it acquired a Chinese firm.

"We're looking to accelerate the growth to the 30 to 35 percent range certainly over the next three years," Jim Ritchie, president and CEO of YRC Worldwide's logistics unit, said on Wednesday.

YRC Logistics' China sales in 2006 were $350 million, accounting for 35 percent of global sales.

On Tuesday, YRC Worldwide announced a preliminary deal to acquire Chinese transportation service provider Shanghai Jiayu Logistics Ltd., marking its latest expansion in the China market, its largest in Asia.

Like many of its peers, YRC Worldwide followed its clients into the China market, where robust global trade is driving demand for freight and logistics services.

The Overland Park, Kansas-based company already operates two ventures with Chinese air freight firm Jinjiang International Industrial Investment Co. (900914.SS) that offer freight forwarding and logistics services.

The deal with Jiayu, if finalised, would add 3,000 vehicles to YRC Worldwide's existing fleet of 200 in China, providing a solid platform for expansion in the fragmented but fast-growing market, said Bill Zollars, YRC Worldwide's chief executive.

He added that he would seek further acquisitions if opportunities arose.

YRC Worldwide, whose core clients include General Motors (GM.N) and Wal-Mart Stores Inc. (WMT.N), faces tough competition in China from global leaders such as United Parcel Service Inc. (UPS.N) and Deutsche Post AG (DPWGn.DE).

Zollars said his company had a "first mover" advantage in China over its competitors, which tended to focus more on the package business.

YRC Worldwide's outbound business now makes up the lion's share of its overall China volume, he said.