Vikram Logistic & Maritime Services Pvt Ltd, which is owned by London-listed Infrastructure India Plc, has acquired the logistics business of ETA Engineering Pvt Ltd in a deal worth £18 million (Rs 141 crore) that includes cash payment and assumption of debt. ETA’s logistics business operates under the brand name Freightstar and the current deal will also include an ETA subsidiary called Freightstar Pvt Ltd.
The deal involves a cash payment of £9 million or Rs 70.3 crore, with Vikram Logistic assuming the debt of another £9 million. The cash payment will be made in instalments over the six months following the completion of the transaction.
Vikram Logistic also plans to infuse additional equity of up to £15 million (Rs 117 crore) and fully draw or refinance Freightstar’s committed debt facilities over the course of the next 30 months. This funding will be used to complete the construction of two Freightstar container terminals besides funding the growth and working capital requirements of Vikram Logistic.
“Completion of the transaction will position Vikram Logistic as one of the largest private multi-modal, end-to-end logistics service providers in India. Vikram Logistic will have its own rail and road operations, captive terminals across the country and a broad service offering for both domestic and export-import cargo,” Infrastructure India Plc said in a statement.
Freightstar was founded by Dubai-based ETA Group and is a logistics services provider with a Category I licence from the Indian Railways, allowing it to operate container trains. Freightstar is developing two multi-modal logistics centres in northern and central India (under Freightstar) and has 11 operating container trains. Vikram Logistic is a supply chain transportation and container infrastructure company based in southern India and is currently developing Free Trade Warehousing Zones in Bangalore and Chennai.
“The acquisition of Freightstar presents an opportunity for VLMS to become a market leader in the Indian logistics sector, with company-owned facilities and a transportation network covering a large number of active and growing freight routes across the country,” said Sonny Lulla, CEO of Infrastructure India.
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