TVS Logistics mulls IPO; buys UK firm

TVS Logistics Services (TVS LSL), part of TVS Group, is planning to go for an initial public offer (IPO) over the next 2-3 years and also looking for acquisition opportunities in the logistics space. The company, which has acquired a UK-based after market service provider, is planning to foray into Brazil and China by 2010 through acquisition.

Speaking to reporters in Chennai today Suresh Krishna, chairman, TVS Logistics Services said: "The company had set a target of a Rs 1,000 crore turnover by the year 2010 and planning to double it by 2012."

This growth was facilitated through acquiring companies globally and joint ventures that has been formed in the last few years. Further, the company has started providing services to companies which has discrete component manufacturing.

He added, the company is planning to grow both organically and inorganically in the future. “Last month, we have acquired UK-based Multipart Holding, an after market service provider and scouting for more such opportunities. Our immediate target is to foray into China and Brazil by next year and to go for the IPO in 2-3 years.”

Krishna did not comment on the acquisition cost of Multipart, however, R Dinesh, manging director, TVS Logistics said that company would invest Rs 125 crore in the next two years for creating infrastructures and other facilities in the company.

Commenting on the acquisition, he said: "This would provide customer access, of the main focus for the future acquisitions, to TVS LSL and will also give leverage to Multipart's capabilities and also expand TVS LSL's area of operations to defence and utility services both in India and overseas. The company is also looking at offering logistics solutions for fully built vehicles.

Asked whether Multipart will be merged with TVS LSL, Dinesh said the company would be a 100 per cent subsidiary and the company will look at consolidating the business in Europe through Multipart acquisition.

TVS LSL will look at further consolidating its presence in India, USA and Europe through joint ventures and acquisitions and will enter Brazil and Chinese market in 2010, he added.

Multipart's last year turn over was Rs 448 crore, of which auto motive business was Rs 280 crore, while Defence contributed Rs 144 crore and utility business contributed Rs 24 crore, added Chris Gateley, managing director, Multipart who will continue with the company as chief executive officer.

He added, the company has 250 people employees of which 170 are in warehousing and 80 are in office. This synergy, according to Gateley, would give access to finance, access to countries other than UK, cross reference of customers for providing end-to-end solutions and potential source Rs 200 crore from India and other low cost countries.