Allcargo To Acquire 38.87% Stake From Partners
The acquisition will offer management control and facilitate strategic decision-making, said Allcargo's Shashi Kiran Shetty.
The board of Allcargo Logistics Ltd. has approved a plan to acquire 38.87% stake from its partners at an enterprise value of Rs 373 crore, which will take its stake to 100% in the contract logistics business.
Allcargo's contract logistics business is engaged in managing inventories and providing third-party supply chain solutions to marquee Indian and international customers across chemical, auto, e-commerce and other industries.
The business has a total space of over 5 million square feet under its management and reported an Ebitda of Rs 31 crore in the December quarter, according to an exchange filing.
"This important acquisition will offer us management control and facilitate strategic decision-making," Shashi Kiran Shetty, founder and chairperson of Allcargo Group, said. "This will help us enhance service delivery capabilities to drive growth."
The business has witnessed robust growth over the years, diversifying into several new industry segments, according to Shetty. "We can also expect more synergy between contract logistics and express distribution to further strengthen (the) group's position in the fast-growing express and contract logistics space."
The board also approved sale of the smaller non-core customs clearance business. Allcargo Logistics will sell 61.13% stake in this business for an enterprise value of approximately Rs 42 crore.
The logistics company declared an interim dividend of Rs 3.25 per equity share for the current fiscal.
Shares of the company rose 1.15% to end at Rs 374.45 apiece, compared to a 0.67% gain in the benchmark Nifty.