The Adani group has acquired majority stake in Snowman Logistics Ltd for Rs 296 crore, making its way into cold chain logistics.
A wholly-owned subsidiary of Adani Ports and SEZ Ltd, Adani Logistics signed an agreement to acquire a 40.25 percent stake in Snowman Logistics Ltd from Gateway Distriparks Ltd, the company said in a statement.
With over 30 percent of capacity amongst integrated organised cold chain service providers in India, Snowman is the market leader in cold chain logistics. The latest acquisition is in line with the firm’s strategy to move from port gate to customer gate and gives it a platform to double its capacity over the next five years.
“The purchase price of Rs 44 per share represents a 3.2 percent premium to the market price of December 27, 2019 and a 12 percent premium to 60 day average,” the release said.
Adani Logistics will make a mandatory open offer as per the Substantial Acquisition of Shares and Takeover Guidelines, 2011 for a maximum 26 percent of the public shareholding in the Snowman Logistics.
The acquisition, which is subject to customary condition precedents, is expected to close by March 31, 2020.
Karan Adani, Chief Executive Officer and Whole Time Director of APSEZ said, “The acquisition is in line with our strategy and vision to be a leader in providing integrated logistics services in India and moving from port gate to customer gate. Cold chain is key product in customer gate strategy given India’s consumer driven demand. We will double the capacity in next 5 years.
“With focus on increase in utilization, higher realization from product mix and operational efficiencies, this vertical will help further improve returns of logistics business,” he added.
Incorporated in 1994, Snowman Logistics is in the business of integrated cold chain logistics providing warehousing, distribution and value added services.
Adani Logistics has expertise in handling varied customer across segments like retail, industrial, bulk, break-bulk, liquids, auto and grain handling. It currently operates 5 logistics parks, 55 rakes, 400,000 sq ft of warehousing space, 5,000-plus containers, 0.9 million tonnes of grain silos and 9 inland waterways vessels.
The company is targeting 15-plus logistics parks, 200-plus rakes, 5 million sq ft of warehouse space, over 15,000 containers, 2.5 million tonnes of grain silos and 25 inland waterways vessels by 2025, the statement said.
News Source:- Moneycontrol