Billionaire Gautam Adani's port-to-power Adani Group has acquired majority stake in Snowman Logistics Ltd for ₹2.96 bln to foray into cold chain logistics.
Adani Logistics Ltd, a wholly-owned subsidiary of Adani Ports and SEZ Ltd, signed definitive agreements to acquire 40.25% stake in Snowman Logistics Ltd from Gateway Distriparks Ltd, the company said in a statement. Snowman is market leader in cold chain logistics with over 30% of capacity amongst integrated organised cold chain service providers in India.
The acquisition gives Adani Logistics platform to double its capacity in the next five years. The buyout is in line with the firm's strategy to move from port gate to customer gate.
"The purchase price of ₹44 per share represents a 3.2% premium to the market price of December 27, 2019 and a 12 per cent premium to 60 day average," it said.
As part of the transaction, Adani Logistics will make a mandatory open offer as per the Substantial Acquisition of Shares and Takeover Guidelines, 2011 for a maximum 26% of the public shareholding in the Snowman Logistics. Acquisition is subject to customary condition precedents and expected to close by March 31, 2020.
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.
Also, on Friday Adani Ports and Special Economic Zone said it would buy a 75% stake in Krishnapatnam Port Co Ltd for an enterprise value of ₹135.72 billion ($1.89 billion). The deal will take its domestic market share to 27% from 22% on a pan-India basis, the company said here in a filing to exchanges.
The port, located in the south eastern state of Andhra Pradesh, is the second-largest private sector port in India and handled 54 MMT of cargo in 2019.
“APSEZ will target to enhance cargo volume at KPCL to 100 million metric tonnes (MMT) in around 7 years and will double its EBIDTA in around 4 years,” said Karan Adani, chief executive officer of APSEZ.
The KPCL deal will help APSEZ meet its target of handling 400 MMT of cargo by 2025, the logistics arm of the Adani Group told reuters.com.
[ ₹100 = €1.30 ]