Adani Ports pays ₹296 cr to pick 40.25% stake in Snowman Logistics

P Manoj / Rajesh Kurup Mumbai | Updated on December 28, 2019 Published on December 28, 2019

With this acquisition, the company enters the cold chain logistics business

Adani Ports and SEZ Ltd (APSEZ), a company controlled by billionaire Gautam Adani, has ventured into cold chain logistics business by acquiring a 40.25 per cent stake in Bengaluru-based Snowman Logistics for ₹296 crore.

APSEZ acquired the stake from Snowman Logistics’ parent company Gateway Distriparks. The acquisition was done through APSEZ’s wholly-owned subsidiary Adani Logistics, the company said in a statement.

This will trigger an open offer of 26 per cent in Snowman Logistics’ shares, it added.

“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,” Karan Adani, Chief Executive Officer and director at APSEZ, said.

READ THE STORY: Adani Ports acquires 40.25 per cent stake in Snowman Logistics

“We will double the capacity in next five years. With focus on increase in utilisation, higher realisation from product mix and operational efficiencies, this vertical will help further improve returns of logistics business,” he added.

The stake was bought at ₹44 per share, which was at a 3.2 per cent premium to the market price of December 27, and a 12 per cent premium to 60-day volume-weighted average price.

The deal is expected to close by March 31, 2020, it added.

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Incorporated in 1993, SLL is in the business of integrated cold chain logistics and provides warehousing, distribution and value added services. It operates 31 temperature-controlled warehouses at 15 locations, with 1.04 lakh pallets warehousing capacity and 293 refrigerated vehicles (reefers).

APSEZ is the largest port developer and operator in India with about 10 ports and terminals — Mundra, Dahej, Kandla and Hazira in Gujarat, Dhamra in Odisha, Mormugao in Goa, Visakhapatnam in Andhra Pradesh, and Kattupalli and Ennore in Chennai — with 24 per cent of the country's total port capacity.

The company is also developing a transhipment port at Vizhinjam, Kerala.

Earlier in the day, sources told BusinessLine that Adani had acquired a significant stake in Snowman Logistics.

Published on December 28, 2019
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