Mumbai-based Allcargo Logistics Ltd recently ventured into the express logistics space by acquiring a controlling stake in Gati Ltd for ₹416 crores, the company said after the board approved the deal. As part of the deal, Allcargo will buy up to 1,03,85,332 equity shares at ₹75 per share from some of the existing members of the Gati Group promoters.
The members include Mahendra Kumar Agarwal, Mahendra Investment Advisors Pvt Ltd and TCI Finance Ltd (TCI) and Gati.Mumbai-based Allcargo Logistics Ltd recently ventured into the express logistics space by acquiring a controlling stake in Gati Ltd for ₹416 crores, the company said after the board approved the deal. As part of the deal, Allcargo will buy up to 1,03,85,332 equity shares at ₹75 per share from some of the existing members of the Gati Group promoters.#
This includes 9,67,000 equity shares of Gati, which pursuant to the order of the High Court at Kolkata are to be restored to TCI and which would form a part of the share purchase agreement (SPA), if restored prior to the completion date of SPA.
Allcargo will also subscribe to a preferential issue of 1,33,33,340 equity shares of Gati at ₹75 per share, subject to the approval of the shareholders of Gati, according to Indian media reports.
If the open offer is fully subscribed, Allcargo will end up with a 44.6 pr cent stake in Gati.
Further, Allcargo will make an open offer to buy 3, 17,42,615 equity shares representing 26 per cent of the paid up voting equity share capital (post preferential issue and vesting of stock option) from the retail share-holders of Gati at ₹75 per share, in accordance with regulatory requirements.
Allcargo provides a range of services like multimodal transport operations (MTO), container freight station operations/inland container depot operations (CFS-ICD) and logistics parks.
With this acquisition, Allcargo is also entering into a strategic relationship with Japanese freight forwarder Kintetsu World Express (KWE), a key customer of ECU Worldwide (Allcargo’s wholly-owned global subsidiary) in its LCL business. This partnership will allow Allcargo and KWE to jointly explore and pursue further collaborations within and outside India.
Kintetsu owns 3.99 per cent stake in Gati.
The acquisition seeks to align Allcargo with the growing Indian transportation and logistics market which is expected to further consolidate owing to the digital push and continued reforms pursued by the government.
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