CDC Group Plc, the UK government's development finance institution, has made an equity investment of $36 million (Rs 255.36 crore) in Warburg Pincus-backed logistics firm Ecom Express Pvt. Ltd.
The fresh equity injection will help Ecom Express to expand its network and increase employee strength from 32,000 to 47,000 over the next one to two years, the logistics company said in a statement.
VCCircle first reported the impending investment by CDC in October.
TA Krishnan, co-founder and chief executive officer at Ecom Express, said the capital infusion will help the company expand its delivery footprint in connecting towns and rural centres across the country.
Ecom Express didn’t disclose the deal valuation, but CDC may have picked up a single-digit stake in the company.
CDC said it will work with Ecom Express to shift a proportion of its distribution fleet to electric vehicles and sponsor a road safety programme for its drivers and fleet operators as part of its climate initiatives.
“In Ecom Express, we have a partner company that recognises the vital importance of creating a genuinely sustainable and gender-inclusive business,” said Srini Nagarajan, managing director and head of Asia, CDC.
CDC, which also makes impact investments in South Asia and Africa, has committed more than $1.7 billion to businesses in India.
Historically, the ticket size of CDC's equity investment in Indian companies has varied from $10 million to as much as $150 million in India Infoline Finance Ltd.
In the logistics segment, CDC had invested $25 million in Pristine Logistics and Infraprojects Pvt. Ltd, which builds and operates rail freight terminals, in 2015. Its overall bet on Pristine is way higher at $200 million, through a combination of equity and debt investment. CDC exited the company in March 2018, according to its website.
Ecom Express was founded in 2012 by TA Krishnan, K Satyanarayana, Manju Dhawan and Sanjeev Saxena. The company provides end-to-end logistics solutions, specifically catering to the e-commerce sector.
It picks up and delivers online orders from partner websites, and also provides business-to-business goods transport, cross-border logistics, and reverse logistics services. The company has its presence in all 29 states of the country and operates in over 2,400 towns and cities.
The company had raised $30 million in September 2017. This was a top-up investment from Warburg Pincus, which had committed $133 million in 2015.