VRL to utilise Rs. 125 cr for expansion
New Silk Route (NSR), which manages $1.4-billion private equity funds focused in Asia and the Indian subcontinent, has invested R175 crore in the Hubli-based logistics company VRL Logistics.
VRL will utilise R125 crore for expanding its business, while its promoters will get the balance amount of R50 crore for selling their stake to NSR, the companies said on Thursday in a joint media statement. NSR’s stake in VRL, however, was not disclosed.
“We believe that the infrastructure and logistics segment in India will grow exponentially in the next couple of years and this partnership helps us to further strengthen our infrastructure portfolio,” said Darius Pandole, partner at NSR, who will also join VRL’s board as a director.
“We see a tremendous potential for growth and have complete faith in VRL?s differentiated operating model,” he added. This is VRL’s first capital infusion in the last 35 years of its operations. SMC Capitals advised the company on this transaction.
?We were in talks with other private equity firms as well; however, we chose to partner with New Silk Route as it brought strong industry expertise with experienced partners who have led other companies in this sector,” said Vijay Sankeshwar, chairman and managing director, VRL Logistics. “The investment is not only about raising capital, which would help us meet our growth needs, but also building the foundation of a lasting partnership,? he added. NSR has been in India since 2006 and has invested in consumption driven sectors such as healthcare, education, retail and infrastructure. Its portfolio of 14 companies include 9X Media, Ascend Telecom, Destimoney and Nectar Lifesciences.
VRL Logistics, which clocked in sales of R893 crore last year, is a provider of goods and passenger transportation services and owns a fleet of around 3000 trucks and 400 buses. It also owns and operates an aircraft for chartering passengers and has installed 42.50 MW for power generation through Windmills. It runs private bus operations in the Karnataka, Maharashtra, Goa, Tamil Nadu, Andhra Pradesh and Gujarat.