Global private equity major KKR & Co said Wednesday it has agreed to pick up a majority stake in logistics solutions company Leap India, a move that will push the PE firm’s presence in the infrastructure space in Asia.
The transaction adds to KKR's infrastructure bets in India that include investments in a decarbonization platform, renewable energy companies, highways and power transmission.
The deal is likely to be closed by the third quarter of 2023. The financial details of the transaction were not disclosed.
The deal is also likely to allow an exit to at least some of Leap's existing investors, if not all, although neither the company nor KKR provided any such details.
A separate email query sent to Leap India did not elicit a response until the publishing of this article. A spokesperson for KKR said Leap founder Sunu Mathew will remain as an investor in the company but declined to comment on exits by other shareholders.
Leap India’s investors include Morgan Stanley India Infrastructure, an IIFL fund, Mayfield Fund, First Bridge, Sixth Sense Ventures, and TVS Capital, among others. Sixth Sense and Mayfield had clocked a partial exit in 2021 when Schroder Adveq Management and a fund managed by IIFL bet on the company. Morgan Stanley’s India Infrastructure Fund acquired a stake in Leap India in early 2021 for Rs 180 crore ($25 million).
“Leap is a standout leader in India’s pallet pooling industry who will play an important role in driving the country’s continued modernisation and growth. It is supporting this shift by providing the critical assets needed for the manufacturing, storage, and movement of goods in supply chains and in so doing also helps companies to be better equipped to improve the environmental impact of their operations,” said Ami Momaya, director, infrastructure at KKR.
Leap India, founded in 2013 by Sunu Mathew, offers supply chain solutions, including equipment pooling, returnable packaging, inventory management and movement, transportation, and repair and maintenance, with clientele in industries including e-commerce, consumer durables, beverages, fast-moving consumer goods and automotive.
Currently, it operates a network of 21 warehouses and manages assets valued more than $6 million, including pallets and containers, across India.
The KKR deal means Leap won't go ahead with its listing plans anytime soon. In November, Mint reported that the logistics firm, aimed to raise about Rs 1,000 crore through an initial public offering (IPO). The planned public offering was to comprise a fresh issue of equity shares and an offer for sale by its shareholders.
For the private equity player, the deal is a part of its Asia infrastructure strategy. In May, it signed a cheque valued around $250 million for Serentica Renewables, a decarbonisation platform set up by mining billionaire Anil Agarwal. The fresh investment came less than six months after the US-based buyout firm committed $400 million to Serentica.
Some of its other infra-focused bets include Virescent Infrastructure, a renewable energy platform in India, IndiGrid, an infrastructure investment trust (InvIT), Highways Infrastructure Trust, a roads InvIT, among others.
Among other sectors, VCCircle reported in June that the PE firm was evaluating potential acquisitions in India’s beauty and personal care sector in a bid to boost operations of existing portfolio company Vini Cosmetics.
