Allcargo Logistics ups stake in Gati to 20.8%

Allcargo Logistics Ltd has raised its stake in Gati Ltd to 20.8 per cent by acquiring an additional 7.5 per cent stake on Tuesday, consolidating its position as the single largest shareholder in the express logistics company.

Through a preferential allotment after getting approval from Gati’s shareholders at an EGM on January 7, and through open market purchases, Allcargo had acquired close to a 13 per cent stake in Gati last week.

On Tuesday, it bought an additional 91 lakh shares in the company through two different transactions. It directly bought a 5.16 per cent stake from Gati promoters pursuant to a share purchase agreement, and acquired another 2.31 per cent stake through open market purchases.

Regulatory compliance

“Allcargo is on course to complete the transaction to acquire a 44.5 per cent stake in Gati,” said Shashi Kiran Shetty, Chairman, Allcargo Logistics. “We are abiding by the regulatory and compliance norms while carrying out the transaction. With this acquisition, we will gain a leadership position in the domestic express transportation segment and develop capabilities to offer end-to-end transportation to our valued customers.”

The recent purchase of shares from the promoters marks the end of the second phase of a three-way deal announced last December that Allcargo intends to complete in due course.

The final stage involves Allcargo making an open offer to buy 3,17,42,615 equity shares representing 26 per cent of the paid-up voting equity share capital (post preferential issue and vesting of stock option) from the retail shareholders of Gati at ₹75 per share, in line with the SEBI (Substantial Acquisition of Shares and Takeover) Regulations, 2011.

If the open offer is fully subscribed, Allcargo will end up with a 44.5 per cent stake in Gati.

The money required to fund the open offer (₹238 crore) has been deposited into an escrow account set up under SEBI norms.