IPO bound Delhivery, a new age domestic logistics giant and supply chain firm , backed by the likes of Softbank, Tiger Global Management and Carlyle, has signed an agreement to acquire a 100 per cent stake in rival express logistics player Spoton Logistics, multiple industry sources with knowledge of the matter told Moneycontrol.
Moneycontrol was the first to report deal talks between both the parties on June 28th, 2021
Read: Ahead Of IPO, Softbank Backed Delhivery In Talks To Acquire Rival Logistics Firm Spoton
“The deal has been signed. Delhivery is keen to scale up ahead of its much anticipated market debut,” one of the individuals above told Moneycontrol.
Recently, a unit of US transportation giant FedEx had pumped in $100 mn into Delhivery, which is also backed by CPPIB, Fidelity and GIC.
“The deal valuation is around $200 mn and it will facilitate an exit for the promoter private equity funds Samara Capital & Xponentia Fund Partners,” said a second individual adding that the deal is likely to be closed in the next 2-3 weeks.
A third individual confirmed the same.
All the three individuals spoke to Moneycontrol on the condition of anonymity.
Moneycontrol is awaiting responses to email queries sent to Delhivery, Spoton, Samara Capital and Xponentia Fund Partners and will update this article as soon as it hears from the firms.
In August 2018, a consortium of Samaara Capital and Xponentia Fund Partners purchased Spoton Logistics for around Rs 550 crores. PE firm India Equity Partners completely exited the firm with this deal.
THE DELHIVERY STRATEGY
In an interview to the Economic Times dated June 7th, 2021, Delhivery co-founder and chief executive Sahil Barua indicated that the firm plans to list within the next 6 to 8 months and raise a primary issue in the range of $400 mn to $500 mn.
“We are going to be more acquisitive than we have been in the past. It is because there is a mismatch on valuation. We are not going to buy anything for $100 million,” he added.
Founded in 2011 by Barua, Mohit Tandon, Bhavesh Manglani, Kapil Bharati and Suraj Saharan, Delhivery reported a loss of Rs 284 crore during the financial year 2019-2020. It came down from Rs 1,781 crore in the financial year 2018-2019. The revenue increased by 74 percent to Rs 2,986.4 crore during the financial year 2020.
A CLOSER LOOK AT THE TARGET
Spoton Logistics started its journey in 2012, when India Equity Partners bought the domestic business from TNT India. It has a team of more than 1600 plus employees and operates a pan India network covering 300+ locations and over 22,000+ pin codes. It has 13 major depots and 35 transit hubs to facilitate timely and secure movement of goods. It serves an array of sectors viz. Hi-Tech, Automotive, Engineering, Pharmaceutical, Electronics & Electricals and Lifestyle & Retail.
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