Singapore-based Gateway Partners is acquiring a minority stake in TVS Supply Chain Solutions Ltd, the logistics arm of the TVS Group, for $100 million (about Rs 740 crore).
The investment involves both a primary infusion of capital and a secondary purchase of shares, TVS said in a statement. It didn’t give a break-up of the primary and secondary components.
The announcement comes barely a month after VCCircle first reported that Gateway Partners, led by former Standard Chartered Plc banker Viswanathan Shankar, was likely to invest in TVS Supply.
The deal is the second-largest private equity investment in TVS Supply after Canadian pension fund CDPQ invested $155 million in 2016.
R Dinesh, managing director at TVS Supply, said the investment by Gateway Partners will help the logistics company expand its footprint.
TVS Supply was started as a business unit of TV Sundram Iyengar & Sons Ltd in 1995 and was established as a separate company, TVS Logistics Services Ltd, in December 2004. The company was renamed TVS Supply in 2019.
TVS Group held a 33.9% stake in TVS Supply Chain, CDPQ 38.4% and Dinram Logistics 9.4%. Tata Opportunities Fund owned a 7.46% stake in the company, a 2018 India Ratings report shows.
The company didn’t disclose the name of the sellers in the latest transaction. However, VCCircle had reported last month that Dinram Logistics was likely to make a partial exit in the new transaction.
Apart from India, TVS Supply has a presence in 14 countries including the UK, the US, Germany, Spain, Singapore and Australia. It caters to sectors like automobile, beverages, IT, healthcare, telecom, retail and defence globally.
Gateway Partners is an alternative investment manager established in 2014. It focuses on emerging markets of South and Southeast Asia, the Middle East and Africa.
Anand Kumar, co-founder at Gateway Partners, said TVS Supply is well-positioned to continue providing end-to-end solutions for international and Indian customers. “…the company is uniquely placed to leverage the growing global demand for value-added supply chain management services,” Kumar said.
According to VCCEdge, the data research platform of Mosaic Digital, TVS Supply’s consolidated net sales rose to Rs 6,780 crore for the financial year ended in March 2019 from Rs 5,341.8 crore the year before. However, it swung to a consolidated net loss of Rs 37.6 crore for 2018-19 from a profit of Rs 53.6 crore the previous year.